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PLAYMATES HOLDINGS LIMITED

(Incorporated in Bermuda with limited liability)
(Stock Code: 635)
INTERIM RESULTS ANNOUNCEMENT
FOR THE SIX MONTHS ENDED 30 JUNE 2007
MANAGEMENT DISCUSSION AND ANALYSIS

Highlights
2007 2006

For the six months ended 30 June HK$’000 HK$’000
Group turnover 376,133 338,837
– from toy business 347,579 317,579
– from property investment & associated business 28,554 21,258
Gross profit 192,879 165,327
Revaluation surplus on investment properties 105,474 167,931
Operating profit 105,056 135,585
Profit before taxation 145,089 142,432
Profit attributable to shareholders 119,162 125,105
Earnings per share HK cents HK cents
– Basic 5.99 6.69
– Diluted 5.91 6.64
Interim dividend per share 2.00 2.00
Toy Business
Playmates Toys worldwide sales during the first half of 2007 were HK$348 million, an increase of
9% over the same period last year. The increase was attributable to a 42% growth in our international
business, realized through the continued expansion into Latin America and Eastern Europe combined
with growth in Teenage Mutant Ninja Turtles

(“Turtles”) worldwide. According to trade statistics,
overall industry year-to-date (June 2007) retail sales in the U.S. increased by 3% over 2006, led by
strong growth in the vehicle, plush, arts and crafts, and youth electronics categories. Industry sales
in the doll category were flat, while those in the action figure category was down by 4%. For the
first half of 2007, Playmates Toys’ U.S. sales were flat compared to the same period last year.

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Gross profit ratio on toy sales was 47% during the first half of 2007 (45% during the same period in
2006). This increase is attributable to sales mix favoring higher margin products, and lower research
and development expenses during the period. Consistent with Playmates Toys’ operating strategy,
recurring operating expenses were maintained at similar levels as the same period last year. Segment
operating loss was HK$10 million, a HK$22 million improvement over the same period last year,
resulting from the increase in sales, higher gross profit and lower marketing expenditure.
Strong worldwide sales of Turtles, propelled by the launch of the movie TMNT, drove the first half
sales increase. This increase was partially offset by the discontinuation of the King Kong

and
Battle Dice
TM
product lines which had contributed to sales in the first half of 2006. Overall sales of
Playmates Toys’ girls brands, including Strawberry Shortcake
TM
, Disney

Princess and Disney
Fairies

, although lower than the same period last year, remained strong and were in line with the
current year plan of launching major brand extensions in the fall.
New brand introductions and major brand extensions scheduled for the fall include Popples
TM
, the
well-recognized American Greetings

brand; Land Before Time

, a Universal Studios

preschool
brand that has entertained kids worldwide for over a decade; an expanded Amazing family of dolls,
and WOW Pals
TM
, Playmates Toys’ proprietary feature plush brand.
Brand Overview
The successful TMNT movie launch, together with the ongoing programming of new episodes of
the Fast Forward animated television series, combined with the anticipated DVD release of the
TMNT feature film in the fall of 2007 are expected to maintain continued interest in the Turtles
franchise.
This fall, new girls toy introductions will be led by extensions to the successful Amazing family of
dolls and WOW Pals
TM
feature plush brand. The Amazing brand will grow with the introduction of
Amazing McKayla
TM
, a smart baby doll and Amazing Lexie
TM
, a unique talking fashion puppy.
Internationally, by fall 2007, Amazing Amanda
TM
will be available in eleven different languages,
including Mandarin for the Mainland China market. A new Blade, the Skate ’n Tricks Puppy
TM
joins the other WOW Pals
TM
this fall, further expanding our proprietary feature plush brand of one-
of-a-kind play pals.
Since the introduction of our new-look Strawberry Shortcake
TM
line of dolls in 2006, distribution
has expanded both in the U.S. and internationally. Twentieth Century Fox
TM
plans to release three
additional direct-to-video DVDs in 2007. These are expected to continue to drive this ever-popular
girl’s brand.
Our line of Disney

Princess dolls and accessories are joined this fall by Tea Time Belle

, an
interactive Princess Belle

that plays tea party with the little girl. This unique feature position will
be television advertised and be the driver for the brand in 2007.

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In 2006, Disney

Consumer Products appointed Playmates Toys as their master toy partner for their
newest girls publishing and entertainment franchise, Disney Fairies

. Disney

has identified Disney
Fairies

as one of their most important new girls branding initiatives. Disney

plans to release four
new Disney Fairies

films/DVDs beginning in 2008 with Tinker Bell

, the fairy recognized
worldwide, and her friends.
This fall, Playmates Toys will introduce the revitalized Popples
TM
brand from American Greetings

,
a category leader in the mid-1980s. Playmates Toys will be adding new character designs along
with interactive elements to contemporize and broaden the brand’s appeal. Also in fall 2007, Playmates
Toys will enter the preschool category by launching Land Before Time

, a classic preschool franchise
from Universal Studios

built on a strong heritage of twelve years of home video entertainment, and
all-new animated television programming on Cartoon Network
TM
.
Playmates Toys’ long term growth strategy of portfolio expansion and category diversification
remains in place. In the second half of 2007, Playmates Toys will expand its offerings in feature
plush and preschool, while in 2008 Playmates Toys will introduce new action figure brands, expand
into the girls fashion doll segment and enter the youth electronics category, under the Playmates
Electronics
TM
banner. We are finalizing our 2008 product line to be introduced at the annual October
toy fairs to be held in Hong Kong and Dallas.
Proposed Spin-Off and Separate Listing
The Board of Directors of the Company considered that it is in the best interest of the Company to
pursue a spin-off and separate listing of its toy business, which could bring a number of benefits to
the Group, including the facilitation of market valuation of the Group’s principal business segments,
and the enhancement of the profile of the Group’s toy business as a standalone public group and its
ability to pursue its strategic plans.
The Board announced on 27 April 2007 that it is proposing a possible spin-off and separate listing
of the toy business of the Group on the Main Board of
A further announcement was made by the Board on 23 July 2007 that the Stock Exchange has
granted its approval to the Company to proceed with the proposed spin-off and on 20 July 2007,
Playmates Toys Limited, as the holding company of the Group’s toy business, had submitted an
advance booking form for an application for the listing of, and permission to deal in, the shares of
Playmates Toys Limited on the Main Board of the Stock Exchange.
As the listing of the shares of Playmates Toys Limited pursuant to the proposed spin-off is subject
to, amongst other things, the approval of the Listing Committee of the Stock Exchange, the final
decision of the Board and the board of directors of Playmates Toys Limited, the proposed spin-off
may or may not proceed, and shareholders of the Company and public investors are advised to
exercise caution when dealing in the securities of the Company.

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Further announcements will be made to update shareholders of the Company and public investors
on the proposed spin-off as and when appropriate.
Property and Other Investments
Rental and management income from the Group’s investment properties for the period was HK$29
million, an increase of 34% from the same period a year ago. Segment operating profit was HK$124
million (including revaluation surplus of HK$105 million), compared to HK$181 million (including
revaluation surplus of HK$168 million) in the same period last year. The overall occupancy rate
maintained at a high level during the period under review.
Rental income generated by the principal property at 100 Canton Road recorded a growth of
approximately 25% during the period. The significant increase in rental income was attributable to
higher average rental rates for leases signed in the second half of 2006 and early 2007 than the rates
of expired leases. During the period, one floor previously occupied by office tenant was leased to a
beauty and skin treatment specialist and further expanded the spectrum of spa and beauty services
at 100 Canton Road. With the completion of the enhancement program, management is confident to
optimize and further improve the tenant mix of this principal investment property.
Rental income generated by the residential properties at MacDonnell Road recorded a growth of
85% during the period. The significant increase in rental income was mainly due to the improvement
in rental yields from new leases as a result of the ongoing refurbishment and upgrade program
carried out since the acquisition in 2006.
The Group has adopted the fair value method for its investment properties. As at the end of the
period under review, the investment properties of the Group were revalued by an independent
professional surveyor. A valuation surplus of HK$105 million was reported in the consolidated
income statement of the Group for the period.
With the continued growth of the local and regional economy, management remains confident in the
medium to long term prospects of its property investment and associated business which will
continue to form an important segment of the activities of the Group.
The Group’s other investment activities include managing a portfolio of cash, bank deposits and
various financial instruments. As at 30 June 2007, the aggregate value of the Group’s investment
portfolio was approximately HK$821 million (31 December 2006: HK$501 million), a high proportion
of which, HK$299 million (31 December 2006: HK$170 million) was cash and bank deposits, and
total outstanding bank loan was approximately HK$61 million (31 December 2006: HK$108 million).
Net contributions from interest income, interest expense and bank charges, dividend income from
investments and net gain on investments during the period was approximately HK$40 million
compared to HK$7 million during the same period last year. Going forward, however, and in view
of the volatility in capital markets across the globe, future earnings from investments may be
uncertain.

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CONDENSED FINANCIAL INFORMATION

Condensed consolidated income statement
For the six months ended 30 June 2007
Unaudited
Six months ended 30 June
2007 2007 2006

Note US$’000 HK$’000 HK$’000
(Note 9)
Turnover 2 48,222 376,133 338,837
Cost of sales (23,494) (183,254) (173,510)
Gross profit 24,728 192,879 165,327
Marketing expenses (10,195) (79,525) (92,840)
Selling, distribution and
administration expenses (14,586) (113,772) (104,833)
Revaluation surplus on
investment properties 13,522 105,474 167,931
Operating profit 13,469 105,056 135,585
Non-operating income/(expenses)
Interest expense and bank charges (481) (3,750) (2,012)
Other revenues 836 6,521 7,602
Net gain on investments 4,811 37,528 1,056
18,635 145,355 142,231

Share of profits less losses of
associated companies (34) (266) 201
Profit before taxation 3 18,601 145,089 142,432
Taxation 4 (3,324) (25,927) (17,327)
Profit attributable to shareholders 15,277 119,162 125,105
Dividend 5 5,705 44,501 37,399
US cents HK cents HK cents
Earnings per share 6
Basic 0.77 5.99 6.69
Diluted 0.76 5.91 6.64

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Condensed consolidated balance sheet
As at 30 June 2007 and 31 December 2006
Unaudited Unaudited Audited
30 June 30 June 31 December
2007 2007 2006

Note US$’000 HK$’000 HK$’000
(Note 9)
Non-current assets
Fixed assets
– Investment properties 166,128 1,295,800 1,198,700
– Other property, plant and equipment 5,756 44,893 37,117
– Prepaid premium on leasehold land
held for own use under an
operating lease 7,917 61,755 48,102
179,801 1,402,448 1,283,919

Goodwill 766 5,976 5,976
Investment in associated companies 4,253 33,170 34,836
Deferred tax assets 9,489 74,017 80,152
194,309 1,515,611 1,404,883

Current assets
Inventories 6,271 48,917 49,470
Trade receivables 7 15,615 121,794 353,999
Other receivables, deposits and
prepayments 9,449 73,699 65,492
Taxation recoverable 404 3,151 2,023
Financial assets at fair value
through profit or loss 66,964 522,320 331,204
Cash and bank balances 38,310 298,821 170,015
137,013 1,068,702 972,203

Current liabilities
Bank loans 7,796 60,808 107,542
Trade payables 8 6,309 49,209 92,585
Other payables and accrued charges 11,572 90,263 163,906
Provisions 3,433 26,780 49,260
Taxation payable 386 3,009 1,317
29,496 230,069 414,610

Net current assets 107,517 838,633 557,593
Total assets less current liabilities 301,826 2,354,244 1,962,476
Non-current liabilities
Bank loans ––276
Deferred tax liabilities 14,535 113,376 94,090
14,535 113,376 94,366

Net assets 287,291 2,240,868 1,868,110
Financed by:
Share capital 28,526 222,504 187,108
Reserves 253,060 1,973,863 1,587,448
Proposed dividend 5 5,705 44,501 93,554
Shareholders’ funds 287,291 2,240,868 1,868,110

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Notes:
1 Basis of preparation and accounting policies
This condensed consolidated financial information has been prepared in accordance with the applicable disclosure
requirements of Appendix 16 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong
Kong Limited and Hong Kong Accounting Standard 34 “Interim Financial Reporting” issued by the Hong Kong
Institute of Certified Public Accountants.
This condensed consolidated financial information should be read in conjunction with the 2006 annual financial
statements.
The accounting policies and methods of computation used in the preparation of this condensed consolidated
financial information are consistent with those used in the annual financial statements for the year ended 31
December 2006.
The Group has not applied any new standards or interpretation that is not yet effective for the current accounting
period. The Group has already commenced an assessment of the impact of these new standards and interpretations
but is not yet in a position to state whether they would significantly impact on its results of operations and
financial position.
2 Segment information
The Group is principally engaged in the design, development, marketing and distribution of toys and family
entertainment activity products, and property investment and management.
Business segments
An analysis of the Group’s turnover and results for the period by business segments is as follows:
Six months ended 30 June 2007
Property
investment
and
Toy associated
business business Elimination Group
HK$’000 HK$’000 HK$’000 HK$’000
Revenue
Turnover 347,579 28,554 – 376,133
Inter-segment revenue (Note iii) – 185 (185) –
347,579 28,739 (185) 376,133
Results
Segment results (9,412) 123,607 – 114,195
Inter-segment transactions (185) 185 – –
(9,597) 123,792 – 114,195
Unallocated costs (9,139)
Operating profit 105,056

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Six months ended 30 June 2006
Property
investment
and
Toy associated
business business Elimination Group
HK$’000 HK$’000 HK$’000 HK$’000
Revenue
Turnover 317,579 21,258 – 338,837
Inter-segment revenue (Note iii) – 341 (341) –
317,579 21,599 (341) 338,837
Results
Segment results (31,719) 180,717 – 148,998
Inter-segment transactions (341) 341 – –
(32,060) 181,058 – 148,998
Unallocated costs (13,413)
Operating profit 135,585
Notes:
(i) Toy business refers to the design, development, marketing and distribution of toys and family entertainment
activity products.
(ii) Property investment and associated business refers to the leasing of commercial, industrial and residential
premises to generate rental income, and the provision of property management services.
(iii) Inter-segment revenue eliminated on consolidation represents inter-company rental charges on properties
owned by the Group. Inter-segment transactions are conducted at arm’s length.
Geographical segments
An analysis of the Group’s turnover for the period by geographical segments is as follows:
Six months ended 30 June
2007 2006

HK$’000 HK$’000
Americas
– U.S. 224,418 231,030
– Others 29,906 28,049
Europe 70,680 42,707
Asia Pacific 50,521 35,967
Others 608 1,084
376,133 338,837

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3 Profit before taxation
Profit before taxation is stated after charging and crediting the following:
Six months ended 30 June
2007 2006

HK$’000 HK$’000
Charging:
Cost of inventories sold 159,436 143,563
Allowance for customer concession 4,391 2,557
Staff costs 50,122 45,142
Depreciation of fixed assets 4,121 3,794
Loss on disposal of fixed assets 8 39
Crediting:
Interest income 5,273 6,558
Dividend income from investments 1,248 1,044
Unutilised allowance for customer concession – 1,532
4 Taxation
Hong Kong profits tax has been provided at the rate of 17.5% (2006: 17.5%) on the estimated assessable profit
for the period. Overseas taxation is provided on the profits/losses of the overseas subsidiaries in accordance
with the tax laws of the countries in which these entities operate.
The taxation charge/(credit) in the condensed consolidated income statement comprises:
Six months ended 30 June
2007 2006

HK$’000 HK$’000
Current taxation
Hong Kong profits tax 2,035 392
Overseas taxation (1,240) (10,793)
Over-provision in prior years (289) (3,558)
506 (13,959)
Deferred taxation
Origination and reversal of temporary differences 25,421 31,286
25,927 17,327

5 Dividend
At a meeting held on 12 March 2007 the Directors proposed a final dividend of HK cents 3.0 and a special
dividend of HK cents 2.0 per share for the year ended 31 December 2006, which was paid on 18 May 2007 and
has been reflected as an appropriation of retained profits for the six months ended 30 June 2007.

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At a meeting held on 17 August 2007 the Directors declared an interim dividend of HK cents 2.0 (2006: HK
cents 2.0) per share for the year ending 31 December 2007 to be paid on 19 September 2007 to shareholders on
the Company’s Register of Members on 12 September 2007. This proposed dividend is not reflected as a
dividend payable in these condensed accounts, but will be reflected as an appropriation of retained profits for
the year ending 31 December 2007.
6 Earnings per share
The calculations of basic and diluted earnings per share are based on the following data:
Six months ended 30 June
2007 2006

HK$’000 HK$’000
Profit attributable to shareholders for the purpose of
calculating basic and diluted earnings per share 119,162 125,105
Number of shares
Weighted average number of ordinary shares for the purpose of
calculating basic earnings per share 1,989,729,000 1,868,725,000
Number of potential ordinary shares issuable under share
options and warrants 27,848,000 16,172,000
Weighted average number of ordinary shares for the purpose of
calculating diluted earnings per share 2,017,577,000 1,884,897,000
7 Trade receivables
As at 30 June 2007, 91.6% (31 December 2006: 96.9%) of the trade receivables net of provisions were current
to 30 days, 7.5% (31 December 2006: 1.2%) were 31 to 60 days and the remaining were over 60 days. The
provisions included allowance on customer concession that is arrived at by using available contemporary and
historical information to evaluate the exposure.
The normal trade terms with toy business customers are letters of credit at sight or usance or on open accounts
with credit term of 60 days on average. For property investment and associated business, no credit term is
granted to tenants.
8 Trade payables
As at 30 June 2007, 91.3% (31 December 2006: 59.1%) of the trade payables were current to 30 days, 8.2% (31
December 2006: 40.4%) were 31 to 60 days and the remaining were over 60 days.
9 US dollar equivalents
These are shown for reference only and have been arrived at based on the exchange rate of HK$7.8 to US$1
ruling at 30 June 2007.

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FINANCIAL ANALYSIS

The toy business is inherently seasonal in nature. In general, sales in the second half-year are much
higher than those in the first half. As a result, a disproportionately high balance of trade receivables
is generated during the peak selling season in the second half of the year. Consistent with usual
trade practices, a significant portion of the trade receivables is collected in the final weeks of the
fourth quarter and in the first quarter of the subsequent year, resulting in a seasonal demand for
working capital during the peak selling season. As at 30 June 2007, trade receivables related to toy
operation were HK$121,593,000 (31 December 2006: HK$353,212,000) and inventories were
HK$48,917,000 (31 December 2006: HK$49,470,000).
The property investment and associated business generated a relatively steady income stream
throughout the period. Approximately 92% of the total gross floor area of the Group’s investment
properties were leased out as at 30 June 2007. Accounts receivables were minimal as at the period
end.
The Group’s gearing ratio, defined as total bank borrowings expressed as a percentage of total
tangible assets, at 30 June 2007 was 2.4% compared to 4.5% at 31 December 2006. The current
ratio, calculated as the ratio of current assets to current liabilities, was 4.6 at 30 June 2007 compared
to 2.3 at 31 December 2006.
The Group maintains a level of cash that is necessary and sufficient to serve recurring operations as
well as further growth and developmental needs. After considering the operating cash flow and
liquidity requirements, a portion of cash on hand may be invested from time to time in various types
of financial instruments including fixed income, equity, derivatives and managed funds with a view
to enhance overall return. The selection and allocation of such yield enhancement investments are
regularly reviewed to ensure that an acceptable risk-and-return profile is maintained and the liquidity
requirements of the Group are served. As at 30 June 2007, the Group’s cash and bank balances were
HK$298,821,000 (31 December 2006: HK$170,015,000), and the amount invested in various
securities was HK$522,320,000 (31 December 2006: HK$331,204,000).
PURCHASE, SALE OR REDEMPTION OF SHARES

The Company has not redeemed any of its shares during the period. Neither the Company nor any
of its subsidiaries has purchased or sold any of the Company’s shares during the period.
COMPLIANCE WITH THE CODE ON CORPORATE GOVERNANCE PRACTICES

The Company is committed to maintaining and ensuring high standards of corporate governance.
The Company has complied with all the applicable code provisions of the Code on Corporate
Governance Practices (“Code”) as set out in Appendix 14 of the Rules Governing the Listing of
Securities on the Stock Exchange of Hong Kong Limited throughout the six months ended 30 June
2007, except for the deviation from provision A.2.1 of the Code in respect of segregation of the
roles of chairman and chief executive officer.

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The Chairman and chief executive officer of the Company is Mr. Chan Chun Hoo, Thomas. This
deviates from provision A.2.1 of the Code which stipulates that the roles of chairman and chief
executive officer should be separate and should not be performed by the same individual.
The Board comprises three Executive Directors (one of whom is the Chairman) and six Non-
executive Directors. Of the six Non-executive Directors, four are Independent Non-executive
Directors; they represent more than one-third of the Board. Mr. Chan Chun Hoo, Thomas focuses
on Group strategy and is responsible for chairing and managing the efficient operation of the Board
and ensuring that all key issues are considered by the Board in a timely manner; whereas
responsibilities for running of the business operation of the Group are delegated to different designated
senior executives. The Board considers that this structure will not impair the balance of power and
authority between the Board and the management of the business of the Group given that there is a
strong and independent non-executive directorship element on the Board and a clear division of
responsibility in running the business of the Group. The Board believes that the structure outlined
above is beneficial to the Company and its business.
The Audit Committee has reviewed with the management the accounting principles and practices
adopted by the Group and discussed internal controls and financial reporting matters including a
review of the unaudited condensed consolidated financial information for the six months ended 30
June 2007.
CLOSURE OF REGISTER OF MEMBERS

The Register of Members of the Company will be closed from 11 September 2007 to 12 September
2007, both days inclusive, during which period no transfer of shares of the Company will be
registered. In order to be qualified for the declared dividend, all transfers accompanied by the
relevant share certificates must be lodged with the Company’s Branch Share Registrars, Tricor
Abacus Limited, at 26/F., Tesbury Centre, 28 Queen’s Road East, Hong Kong no later than 4:00
p.m. on 10 September 2007.
On behalf of the Board
CHAN Chun Hoo, Thomas
Chairman
Hong Kong, 17 August 2007
As at the date hereof, the Board of Directors of the Company comprises the following Directors:
Executive Directors:
Mr. Chan Chun Hoo, Thomas (Chairman), Mr. Cheng Bing Kin, Alain, Mr. To Shu Sing, Sidney
Non-executive Directors:
Mr. Tsim Tak Lung (Deputy Chairman), Mr. Chow Yu Chun, Alexander (Independent),
Mr. Ip Shu Wing, Charles, Mr. Lee Peng Fei, Allen (Independent), Mr. Lo Kai Yiu, Anthony (Independent),
Mr. Yu Hon To, David (Independent)