Interim Report 2007/20082007/2008

Interim Report 2007/2008
The board of directors (the “Board”) of Samson Paper Holdings Limited (the “Company”) is pleased to announce the unaudited
condensed consolidated interim results of the Company and its subsidiaries (the “Group”) for the six months ended 30 September
2007 together with comparative figures for the corresponding period in 2006, and the unaudited condensed consolidated balance
sheet of the Group as at 30 September 2007 with audited comparative figures as at 3 March 2007. The unaudited interim
financial report has been reviewed by the Company’s audit committee, and the Company’s auditors, PricewaterhouseCoopers,
in accordance with the Statement of Review Engagements 240 “Review of interim financial information performed by the
independent auditor of the entity” issued by the Hong Kong Institute of Certified Public Accountants (“HKICPA”). The auditors,
on the basis of their review, concluded that nothing has come to their attention that causes them to believe that the interim
financial report is not prepared, in all material respects, in accordance with Hong Kong Accounting Standard 34, “Interim Financial
Reporting”.
CONDENSED CONSOLIDATED PROFIT AND LOSS ACCOUNT

Unaudited
Six months ended 30 September
Notes 2007 2006
HK$’000 HK$’000
Turnover 2 1,949,218 ,686,67
Cost of sales (1,769,233) (,538,64)
Gross profit 179,985 48,057
Other gains and income 10,775 2,258
Selling expenses (60,856) (53,653)
Administrative expenses (55,195) (39,428)
Other operating expenses (4,142) (0,)
Operating profit 3 70,567 57,23
Finance costs (27,575) (27,956)
Share of profits less losses of associated companies 618 303
Profit before taxation 43,610 29,470
Taxation 4 (7,734) (4,76)
Profit for the period 35,876 24,709
Attributable to:
Equity holders of the Company 35,766 24,462
Minority interests 110 247
35,876 24,709

Earnings per share for profit attributable to the equity holders of the
Company — Basic 5 HK 8.3 cents HK 5.7 cents
Interim dividend per share HK 2.5 cents HK .5 cents
Interim dividends 6 10,731 6,439

2 Samson Paper Holdings Limited
CONDENSED CONSOLIDATED BALANCE SHEET

As at 30 September 2007
Unaudited Audited
30 September
2007

3 March
2007

Notes HK$’000 HK$’000
Non-current assets
Property, plant and equipment 7 128,776 8,4
Construction in progress 7 1,886 —
Prepaid premium for land leases 7 48,192 48,785
Investment property 51,679 5,679
Intangible assets 8 41,962 32,44
Interest in associated companies 64,170 57,976
Deferred tax assets 5,093 4,055
Finance lease receivables 489 ,58
342,247 34,838

Current assets
Inventories 445,366 352,225
Trade and other receivables 9 1,422,005 ,22,076
Other financial assets at fair value through profit or loss 21,262 34,446
Restricted bank deposits 54,928 4,095
Bank balances and cash 362,477 337,529
2,306,038 ,860,37

Current liabilities
Trade and other payables 10 875,794 649,967
Trust receipt loans 11 561,246 389,509
Taxation payable 5,267 2,348
Other financial liabilities at fair value through profit or loss 100 406
Borrowings 11 337,367 262,953
1,779,774 ,305,83

Net current assets 526,264 555,88
Total assets less current liabilities 868,511 870,026
Equity
Share capital 12 42,926 42,926
Reserves 672,683 646,334
Proposed dividend 10,731 0,73
Equity attributable to shareholders of the Company 726,340 699,99
Minority interests 7,879 6,872
Total equity 734,219 706,863
Non-current liabilities
Borrowings 11 128,169 57,59
Deferred tax liabilities 6,123 6,004
134,292 63,63
868,511 870,026

3Interim Report 2007/2008
CONDENSED CONSOLIDATED CASH FLOW STATEMENT

For the six months ended 30 September 2007
Unaudited
Six months ended 30 September
2007 2006

HK$’000 HK$’000
Net cash (outflow)/inflow from operating activities (139,319) 44,63
Net cash (outflow)/inflow from investing activities (15,127) 4,27
Net cash inflow/(outflow) from financing activities 173,735 (9,527)
Net increase in cash and cash equivalents 19,289 29,303
Cash and cash equivalents at April 336,562 307,798
Effect of change in foreign exchange rate on bank and cash balances 3,011 —
Cash and cash equivalents at 30 September 358,862 337,0
Analysis of balances of cash and cash equivalents
Bank balances and cash 362,477 337,0
Bank overdrafts (3,615) —
358,862 337,0

4 Samson Paper Holdings Limited
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the six months ended 30 September 2007
Unaudited
Share
capital
Share
premium
Assets
revaluation
reserve
Capital
reserve
Exchange
fluctuation
reserve
Retained
earnings Sub-total
Minority
interests Total
HK’000 HK’000 HK’000 HK’000 HK’000 HK’000 HK’000 HK’000 HK’000
At April 2006 42,926 96,293 26,408 33,3 ,658 433,373 633,969 3,930 637,899
Profit for the period — — — — — 24,462 24,462 247 24,709
Share of reserve of an associated
company — — — — (,03) — (,03) — (,03)
Currency translation difference — — — — (2,467) 9 (2,448) — (2,448)
42,926 96,293 26,408 33,3 (,840) 447,23 644,22 4,77 648,398
Proposed 2005–2006 final dividend — — — — — 4,292 4,292 — 4,292
Proposed 2006–2007 interim
dividend — — — — — 6,439 6,439 — 6,439
At 30 September 2006 42,926 96,293 26,408 33,3 (,840) 457,854 654,952 4,77 659,29
At April 2007 42,926 96,293 38,528 33,3 5,424 473,509 699,99 6,872 706,863
Profit for the period — — — — — 35,766 35,766 0 35,876
2006–2007 final dividend — — — — — (0,73) (0,73) — (0,73)
Currency translation difference — — — — ,34 — ,34 27 ,53
Capital injection by a minority
shareholder — — — — — — — 680 680
42,926 96,293 38,528 33,3 6,738 487,83 75,609 7,879 723,488

Proposed 2007–2008 interim
dividend — — — — — 0,73 0,73 — 0,73
At 30 September 2007 42,926 96,293 38,528 33,3 6,738 498,544 726,340 7,879 734,29

5Interim Report 2007/2008
Notes
1. BASIS OF PREPARATION AND ACCOUNTING POLICIES

These unaudited condensed consolidated interim financial statements for the six months ended 30 September 2007 have been prepared in
accordance with Hong Kong Accounting Standard (“HKAS”) 34 “Interim Financial Reporting” and other relevant HKAS and Interpretations,
the Hong Kong Financial Reporting Standards (“HKFRS”) issued by the Hong Kong Institute of Certified Public Accountants, and the
applicable requirements of Appendix 6 of the Rules (the “Listing Rule”) Governing the Listing of Securities on
These condensed interim financial statements should be read in conjunction with the annual financial statements for the year ended 3 March
2007.

The accounting policies and methods of computation used in the preparation of these condensed interim financial statements are consistent
with those used in the annual financial statements for the year ended 3 March 2007 and with the adoption of certain new or revised HKFRS
and HKAS, which are mandatory for the year ending 3 March 2008, among which the following will have disclosure impacts on the 2008
annual financial statements:
• HKFRS 7 Financial instruments: Disclosure; and
• HKAS (Amendment) Amendment to capital disclosures
The adoption of these accounting standards has no material effect on the Group’s results of operations.
2. SEGMENT INFORMATION

(a) Primary reporting format — Business segments
As at 30 September 2007, the Group is organised on a worldwide basis into four main business segments:
() Trading and marketing of paper products;
(2) Provision of logistics services;
(3) Trading and marketing of aeronautic parts and services;
(4) Provision of marine services to marine, oil and gas industries.

6 Samson Paper Holdings Limited
The segment results for the period ended 30 September 2007 are as follows:
Unaudited
Paper
Logistics
services
Aeronautic
parts
Marine
services Unallocated Group
HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000
Total segment revenue 2,045,903 5,347 42,000 36,792 — 2,76,042
Inter-segment revenue (204,360) (22,464) — — — (226,824)
Revenue ,84,543 28,883 42,000 36,792 — ,949,28
Segment result 68,50 (,479) 4,6 ,309 (,889) 70,567
Finance costs (27,575)
Share of profits less losses of
associated companies 68 — — — — 68
Profit before taxation 43,60
Taxation (7,734)
Profit for the period 35,876
The segment results for the period ended 30 September 2006 are as follows:
Unaudited
Paper
Logistics
services
Aeronautic
parts
Marine
services Unallocated Group
HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000
Total segment revenue ,859,035 33,803 27,906 — — ,920,744
Inter-segment revenue (232,649) (,424) — — — (234,073)
Revenue ,626,386 32,379 27,906 — — ,686,67
Segment result 58,238 (2,570) ,87 — (362) 57,23
Finance costs (27,956)
Share of profits less losses of
associated companies 303 — — — — 303
Profit before taxation 29,470
Taxation (4,76)
Profit for the period 24,709

7Interim Report 2007/2008
(b) Secondary reporting format — geographical segments
The Group’s four business segments operate in three main geographical areas, even though they are managed on a worldwide basis.
An analysis of the Group’s turnover for the period by geographical segment is as follows:
Unaudited
Six months ended 30 September
2007 2006

HK$’000 HK$’000
Hong Kong 788,496 729,373
Mainland China 956,527 764,572
Others 204,195 92,726
1,949,218 ,686,67
3. OPERATING PROFIT

Operating profit is stated after crediting and charging the following:
Unaudited
Six months ended 30 September
2007 2006

HK$’000 HK$’000
Crediting
Interest income 4,606 7,752
Provision for impairment on receivables written back 1,023 3,547
Net dilution gain on interest in an associated company 3,719 —
Charging
Depreciation of property, plant and equipment 7,491 3,325
Amortisation of prepaid premium for land leases 649 983
Provision for impairment on inventory 3,275 274
Provision for impairment on receivables 3,317 5,654
4. TAxATION
Hong Kong profits tax has been provided for at the rate of 7.5% (2006:7.5%) on the estimated assessable profit for the period. Taxation
on overseas profit has been calculated on the estimated assessable profit at the applicable rates of taxation prevailing in the countries in
which the Group operates, based on existing legislation, interpretation and practices in respect thereof.
Unaudited
Six months ended 30 September
2007 2006

HK$’000 HK$’000
Hong Kong profits tax 4,235 3,763
Overseas taxation 2,580 ,737
Deferred taxation 919 (739)
7,734 4,76

8 Samson Paper Holdings Limited
5. EARNINGS PER SHARE

Basic earnings per share is calculated by dividing the profit attributable to equity holders of the Company by the weighted average number of
ordinary shares in issue during the period.
Unaudited
Six months ended 30 September
2007 2006

HK$’000 HK$’000
Profit attributable to equity holders of the Company 35,766 24,462
Weighted average number of ordinary shares in issue 429,258 429,258
Basic earnings per share (HK cents) 8.3 5.7
6. INTERIM DIvIDENDS
Unaudited
Six months ended 30 September
2007 2006

HK$’000 HK$’000
Proposed, of HK$0.025 (2006: HK$0.05) per share 10,731 6,439
Note: This proposed interim dividend is not reflected as a dividend payable in these condensed consolidated financial statements, but will be
reflected as an appropriation of retained earnings for the year ending 3 March 2008.
7. CAPITAL ExPENDITURE
Unaudited
Property, plant
and equipment
Prepaid premium
for land leases
Construction in
progress
HK$’000 HK$’000 HK$’000
Six months ended 30 September 2006
Opening net book amount at 1 April 2006 8,37 7,45 —
Currency translation differences (4) — —
Additions 4,46 — —
Disposals (2,230) — —
Depreciation / amortisation (3,325) (983) —
Closing net book amount at 30 September 2006 79,994 70,432 —
Six months ended 30 September 2007
Opening net book amount at 1 April 2007 8,4 48,785 —
Currency translation differences ,280 56 —
Additions 7,069 — ,886
Disposals (493) — —
Depreciation / amortisation (7,49) (649) —
Closing net book amount at 30 September 2007 28,776 48,92 ,886

9Interim Report 2007/2008
8. INTANGIBLE ASSETS

Unaudited
HK$’000
Six months ended 30 September 2006
Opening and closing net book amount at April 2006 and 30 September 2006 —
Six months ended 30 September 2007
Opening net book amount at April 2007 32,414
Currency translation differences 2,052
Additions 7,496
Closing net book amount at 30 September 2007 41,962
Additions during the interim period represent the acquisition of interest in land use right grant contract in respect of a
piece of land located at 中國江蘇������������������������ (South Side of Tong Gang Road, Gangzha Area, Nantong City,
Jiangsu Province, the People’s Republic of China (the “PRC”)) and costs incurred for such acquisition.
9. TRADE AND OTHER RECEIvABLES
Unaudited Audited
30 September 3 March
2007 2007

HK$’000 HK$’000
Trade receivables — net 1,274,224 962,30
Other receivables, deposits and prepayments 145,247 56,870
Finance lease receivables 3,023 4,423
1,422,494 ,23,594

Finance lease receivables — non current portion (489) (,58)
1,422,005 ,22,076

The ageing analysis of trade receivables is as follows:
Unaudited Audited
30 September 3 March
2007 2007

HK$’000 HK$’000
Current to 60 days 925,387 693,075
6 to 90 days 197,001 34,820
Over 90 days 151,836 34,406
1,274,224 962,30

There is no concentration of credit risk with respect to trade receivables as the Group has a large number of customers, which are widely
dispersed within Hong Kong, the PRC and other countries.

0 Samson Paper Holdings Limited
Finance lease receivables
Unaudited Audited
30 September 3 March
2007 2007

HK$’000 HK$’000
Non-current
Finance leases — gross receivables 505 ,583
Unearned finance income (16) (65)
489 ,58

Current
Finance leases — gross receivables 2,725 3,246
Unearned finance income (191) (34)
2,534 2,905

Unaudited Audited
30 September 3 March
2007 2007

HK$’000 HK$’000
Gross receivables from finance leases:
Not later than year 2,725 3,246
Later than year and not later than 5 years 505 ,583
3,230 4,829

Unearned future finance income on finance leases (207) (406)
Net investment in finance leases 3,023 4,423
The net investment in finance leases may be analysed as follows:
Not later than year 2,534 2,905
Later than year and not later than 5 years 489 ,58
3,023 4,423
10. TRADE AND OTHER PAYABLES

Unaudited Audited
30 September 3 March
2007 2007

HK$’000 HK$’000
Trade and bills payables 742,352 543,748
Accrued expenses and other payables 107,108 93,809
Loan from a minority shareholder 1,563 ,563
Amounts due to related companies 14,040 0,847
Dividend payable 10,731 —
875,794 649,967

Interim Report 2007/2008
The ageing analysis of trade and bills payables are as follows:
Unaudited Audited
30 September 3 March
2007 2007

HK$’000 HK$’000
Current to 60 days 628,725 444,6
6 to 90 days 28,122 2,578
Over 90 days 85,505 86,559
742,352 543,748
11. BORROWINGS

Unaudited Audited
30 September 3 March
2007 2007

HK$’000 HK$’000
Non-current
Bank loans — unsecured 86,364 3,22
Bank loans — secured 35,034 9,063
Finance lease liabilities 6,771 6,884
128,169 57,59

Current
Trust receipt loans — unsecured 283,981 29,527
Trust receipt loans — secured 277,265 69,982
Bank loans — unsecured 314,194 245,022
Bank loans — secured 13,875 ,250
Bank overdrafts 3,615 967
Finance lease liabilities 5,683 5,74
898,613 652,462

Total borrowings 1,026,782 809,62
At 30 September 2007, the Group’s bank loans and overdrafts and trust receipt loans were repayable as follows:
Bank loans and overdrafts Trust receipt loans
Unaudited Audited Unaudited Audited
30 September 3 March 30 September 3 March
2007 2007 2007 2007

HK$’000 HK$’000 HK$’000 HK$’000
Within one year 331,684 257,239 561,246 389,509
In the second year 105,273 00,947 — —
In the third to fifth years inclusive 16,125 49,328 — —
453,082 407,54 561,246 389,509

The effective interest rate at the balance sheet date on bank loans and trust receipt loans were 5.8% per annum (3 March 2007: 5.3% per
annum).
The carrying amount of bank loans and trust receipt loans approximates their fair value.

2 Samson Paper Holdings Limited
Finance lease liabilities
Unaudited Audited
30 September 3 March
2007 2007

HK$’000 HK$’000
Gross finance lease liabilities — minimum lease payments :
Not later than year 6,050 5,876
Later than year but not later than 5 years 7,200 7,266
Later than 5 years 127 78
13,377 3,320

Future finance charges on finance leases (923) (722)
Present value of finance lease liabilities 12,454 2,598
Unaudited Audited
30 September 3 March
2007 2007

HK$’000 HK$’000
The present value of finance lease liabilities is as follows :
Not later than year 5,683 5,74
Later than year and no later than 5 years 6,649 6,74
Later than 5 years 122 70
12,454 2,598

At the balance sheet date, the carrying amount of finance lease liabilities approximates their fair value.
12. SHARE CAPITAL

Number of shares of
HK$0.10 each Share capital
Unaudited Audited Unaudited Audited
30 September 3 March 30 September 3 March
2007 2007 2007 2007

HK$’000 HK$’000
Authorised:
At the beginning and the end of
period/year 800,000,000 800,000,000 80,000 80,000
Issued and fully paid:
At the beginning and the end of
period/year 429,258,039 429,258,039 42,926 42,926
The shareholders of the Company adopted a share option scheme to comply with the requirements of Chapter 7 of the Listing Rules. As at
30 September 2007, no option was granted or outstanding.

3Interim Report 2007/2008
13. BANK GUARANTEES

As at 30 September 2007, the Company continued to provide corporate guarantees on the banking facilities granted to the Group’s
subsidiaries. The amount of such facilities utilised by the subsidiaries as at 30 September 2007 amounted to HK$,04,328,000 (3 March
2007: HK$797,023,000).
14. COMMITMENTS

(a) Capital commitments
Capital expenditure at the balance sheet date but not yet incurred is as follows :
Unaudited Audited
30 September
2007

3 March
2007

HK$’000 HK$’000
Property, plant and equipment, contracted but not provided for 171,681 ,500
Prepaid premium for land leases, contracted but not provided for 18,638 —
Intangible assets, contracted but not provided for 3,071 3,832
193,390 5,332

(b) As at 30 September 2007, the subsidiaries of the Company had commitment in respect of the injection of capital into certain
subsidiaries in the PRC amounted to approximately HK$278,969,000 (3 March 2007: HK$90,754,000).
(c) Operating lease commitments
As at 30 September 2007, the Group had total future aggregate minimum lease payments under non-cancellable operating leases in
respect of land and buildings as follows :
Unaudited Audited
30 September
2007

3 March
2007

HK$’000 HK$’000
No later than one year 21,496 7,382
Later than one year and not later than five years 13,871 5,77
Later than five years 2,734 —
38,101 3,099
15. CHARGE OF ASSETS

As at 30 September 2007, trust receipt loans of HK$277,265,000 (3 March 2007: HK$69,982,000) and bank loans of HK$48,909,000
(3 March 2007: HK$30,33,000) were secured by legal charges on the Group’s properties in Hong Kong with net book amount of
approximately HK$34,785,000 (3 March 2007: HK$35,83,000).

4 Samson Paper Holdings Limited
16. RELATED PARTY TRANSACTIONS

Significant related party transactions, which were carried out in the normal course of the Group’s business at prices and terms no less than
those charged and contracted with other third party suppliers and customers of the Group are as follows:
Unaudited
Six months ended 30 September
2007 2006

HK$’000 HK$’000
(a) Sale to and purchase from related parties
(i) Rental income from an associated company 631 870
(ii) Rental expense paid to associated company 931 —
(iii) Purchase from associated companies 26,934 33,069
All the above transactions were carried out on the basis of the price lists in force with non-related parties
Unaudited
30 September
2007

Audited
3 March
2007

HK$’000 HK$’000
(b) Period-end balances arising from sales/purchase of goods
(i) Payables to associated companies 14,040 2,626
(ii) Receivables from associated companies 730 8,975
Balance of receivables from associated companies is included in trade receivables.
Amounts due are unsecured, interest free and repayable on demand.
Unaudited
Six months ended 30 September
2007 2006

HK$’000 HK$’000
(c) Key management compensation
Key management compensation 6,138 5,730

5Interim Report 2007/2008
MANAGEMENT DISCUSSION AND ANALYSIS

The Economy
In the six months ended 30 September 2007, the Hong Kong economy continued to enjoy robust growth with GDP rising at a rate
of 9.8% in the third quarter compared to 8.7% for the second quarter of 2007. In the PRC, the economy maintained phenomenal
growth, with GDP up .5% for the first nine months of 2007.
The Paper Industry
According to the Hong Kong Census and Statistics Department, the total export value of printed matters was HK$0,306 million
during the review period, up 8.6% against the same period last year. The Territory’s import of printed matters was valued at
HK$6,286.6 million, up 0.7% compared with the same period last year.
Operations Review
During the review period, the Group achieved remarkable results, with growing turnover and improving of gross profit margin.
Turnover increased by 5.6% to HK$,949 million as compared with the same period last year. Gross profit increased by 2.6%
to HK$80 million, with gross profit margin improved to 9.2% (2006/07: 8.8%). Operating profit increased by 23.5% to HK$70.6
million. Profit attributable to shareholders rose sharply, up by 46.2% to HK$35.8 million. Net profit margin also improved, from .5%
in the corresponding period last year to .8% this review period. Earnings per share were HK8.3 cents (2006/07: HK5.7 cents).
By business segment, paper products, consumable aeronautic parts/services, marine services, and logistics services accounted for
94.5%, 2.%, .9%, and .5% of the Group’s turnover respectively.
Paper Business
The encouraging growth of the Group’s paper business reflected the Group’s continuous effort and success in broadening its sales
network in the PRC. Increasing market demand for paper products driven by the booming economy also pushed up the average
prices of book printing papers and packaging boards by approximately 0% and 5% respectively and in turn the turnover of the
Group’s paper products benefited. The Group’s shift of strategic focus on to serving quality customers as a means of combating
the effects of intense competition in the paper industry and controlling credit risk also proved to be successful. Provision for
doubtful debts after taking into account the provision written back significantly decreased from 0.7% to 0.% of total turnover
from paper product sales during the review period.
All these factors together contributed to the business achieving turnover of HK$,84.5 million, representing a rise of 3.2% when
compared with the corresponding period last year. In terms of operating profit, HK$68.5 million was recorded representing a rise
of 7.6%.
The PRC market continued to be the main growth driver of the segment’s business. Paper product sales in the market increased
by 24.9% to HK$95.8 million, making up 5.7% of the Group’s total turnover from paper business. The Group sold .7% more
paper products in tonnage through its extensive sales network in the PRC.

6 Samson Paper Holdings Limited
Hong Kong is the Group’s second key market accounted for 4.5% of its total paper product sales. It achieved turnover of
HK$764.3 million, or a rise of 9.3% against the same period last year. As the Group has been consolidating its businesses in other
Asian countries, such as Malaysia, to control credit risks and enjoy more healthy growth in the long run, paper sales from these
regions for the review period dropped by 23.9% to HK$25.4 million, accounting for 6.8% of total turnover from paper product
sales.
Regarding the Group’s paper manufacturing arm, the Singapore-listed United Pulp & Paper Company Limited (“UPP”), it achieved
a net gain of S$. million (2006/07: S$0.4 million). The improved performance was the result of higher paper product prices and
UPP’s successful switch from using fuel oil to natural gas for powering its production plant. The change in fuels was implemented in
September 2006 and has since been translating into significant savings for the operation particularly when oil prices have been on
the rise.
Sales contribution by product was maintained at a stable level. Book printing papers and packaging boards accounted for 50.5% and
33.2% of the Group’s total turnover of paper products respectively.
Consumable Aeronautic Parts / Services Business
The Group has successfully diversified its business in recent years to cover also consumable aeronautic parts/services. This
segment continued to generate increasing revenue for the Group, up by 50.5% to HK$42.0 million, with operating profit up by
26.5% to HK$4. million.
Logistics Services Business
The Group has sought to consolidate its logistics services business by focusing more on key profit centres such as transportation
and warehousing services as reflected in its ongoing expansion in the Yangtze River Delta region. Accordingly, turnover from
logistics services decreased by 0.8% to 28.9 million, but operating loss was reduced by 42.5% to HK$.5 million (2006/07:
operating loss of HK$2.6 million).
Marine Services Business
Hypex Holdings Limited, the wholly-owned subsidiary of the Group acquired in December 2006, provides corrosion prevention
services to the marine, oil and gas industries in Singapore. The corrosion prevention services comprise blasting (hydro and grit)
and painting work. It recorded turnover of HK$36.8 million and operating profit of HK$.3 million during the period under
review.
Prospects
The management team is optimistic about the Group’s business prospects. The anticipated steady rise in price of paper products
in the coming months will bode well for the Group. To strengthen its presence and capture the enormous business opportunities
in the PRC, the Group has opened a new office in Xiamen and will open offices in Shenyang, Naning and Nanjing in the second half
of the financial year, expanding its sales office network currently covering Beijing, Shanghai, Chongqing, Tianjin, Guangzhou, Foshan,
Shenzhen and Wuxi.

7Interim Report 2007/2008
Moreover, the Group believes that by building a vertically integrated operation, it will be assured of stable supply of raw material
and be able to improve overall profit margin. Thus, it signed an agreement to acquire the entire share capital of Kingsrich Group
Limited on 3 July 2007, which has given it 99% holding in Universal Pulp and Paper (Jiangsu) Co. Ltd. (UPP(JS)) (formerly known
as Jiangsu Yuan Tong Paper Co. Ltd), a Sino-foreign equity joint venture specializing in the manufacture and sale of kraftliner board
and corrugated medium.
UPP(JS) is planning to build a paper mill in Nantong, Jiangsu with completion scheduled for the second quarter of 2009. The
designed total production capacity of the paper mill is 250,000 tonnes per annum – 50,000 tonnes kraftliner board and 00,000
tonnes corrugated medium. The Group has already ordered the core units of a kraftliner board and corrugated medium
production line to be installed in the paper mill. The construction work of the plant is expected to begin in mid December 2007.
Between 2002 and 2006, consumption of containerboard products in the PRC had consistently exceeded domestic production.
This phenomenon is expected to continue in the next 0 years according to RISI projection. However, containerboard products
only accounted for less than 5.0% of the total volume of paper products sold by the Group in 2006. This translates into growth
potential for the Group with an over ,000-strong regular client base in the Asia Pacific Region and strong reputation in the PRC
printing and packaging industry as leverage. The Group is confident of securing orders for the new paper mill and expanding the
containerboard business in the next few years to bring better returns to shareholders.
Looking ahead, the Group will strive to strengthen its position in the paper industry and expand its business by moving upstream,
aiming to become one of the leading paper industry players in the PRC.
INTERIM DIvIDEND
The Board has resolved to declare the payment of an interim dividend of HK2.5 cents (2006: HK.5 cents) per share for the six
months ended 30 September 2007. The interim dividend will be payable to all shareholders of the Company whose names appear
on the register of members of the Company on Friday, 4 January 2008. The interim dividend will be paid on or about Friday,
January 2008.
CLOSURE OF REGISTER OF MEMBERS

The register of members of the Company will be closed from Wednesday, 2 January 2008 to Friday, 4 January 2008 (both days
inclusive), during which period no transfers of shares of the Company will be registered. In order to qualify for the interim
dividend, all transfers of shares accompanied by the relevant share certificates must be lodged with the Company’s branch
registrar, Computershare Hong Kong Investor Services Limited at Suite 72–6, 7th Floor, Hopewell Centre, 83 Queen’s Road
East, Wanchai, Hong Kong for registration no later than 4:30 pm on Monday, 3 December 2007.
EMPLOYEES AND REMUNERATION POLICIES

As at 30 September 2007, the total number of the Group’s employees was 934. The Group’s remuneration policies are primarily
based on prevailing market levels and salaries are reviewed with reference to the performance of the Group and the individual
employee concerned. In addition to salary payment, other staff benefits including performance bonus, education subsidies,
provident fund, medical insurance and share option are offered to reward our high-calibre staff. Training on strategic planning and
implementation, sales and marketing disciplines are offered to various management levels on a regular basis.

8 Samson Paper Holdings Limited
LIQUIDITY AND FINANCIAL RESOURCES

The Group’s short term deposits and bank balances and bank borrowings as at 30 September 2007 amounted to approximately
HK$47 million (including restricted bank deposits of HK$55 million) and HK$,04 million respectively. As at 30 September
2007, its gearing ratio, measured on the basis of the Group’s long term debt over the Group’s shareholders’ funds was 7.6% (3
March 2007: 22.5%). With bank balances and other current assets of approximately HK$2,306 million as well as available banking
and trade facilities, the directors of the Company (the “Directors”) believe the Group has sufficient working capital to meet its
present requirement.
The Group’s foreign currency purchases were mainly denominated in United States dollars and RMB. Foreign exchange contracts
and options were used, if necessary, to hedge the Group’s foreign currency exposure. As the Group relied on the RMB banking
finances to fund the operation in the PRC, which provides a natural hedge against currency risks, the appreciation of RMB does
not have much impact on the Group.
DIRECTORS’ AND CHIEF ExECUTIvES’ INTERESTS AND SHORT POSITIONS IN SHARES, UNDERLYING
SHARES AND DEBENTURES

As at 30 September 2007, the interests and short positions of each Director and chief executive of the Company and their
associates in the shares, underlying shares and debentures of the Company or any of its associated corporations (within the
meaning of Part XV of the Securities and Futures Ordinance (the “SFO”)), as recorded in the register required to be kept by the
Company under Section 352 of the SFO or as otherwise notified to the Company and the Stock Exchange pursuant to the Model
Code for Securities Transactions by Directors of Listed Companies (the “Model Code”) were as follows:
(a) Long position in ordinary shares of HK$0.10 each in the Company (the “Shares”)
Number of ordinary shares beneficially held
Capacity
Personal
interest
Corporate
interest
Family
interest
Other
interest Total Percentage
Mr. LEE Seng Jin Beneficial owner
& beneficiary
of trust
60,344,000 — 6,72,556 29,620,000
(Note)
296,676,556 69.%
Ms. SHAM Yee Lan,
Peggy
Beneficial owner
& beneficiary
of trust
572,556 6,40,000 60,344,000 29,620,000

(Note)
296,676,556 69.%
Mr. CHOW
Wing Yuen
Beneficial owner 540,000 — — — 540,000 0.3%
Note:
Shares were held by Quinselle Holdings Limited, acting in its capacity as trustee of a private unit trust. HSBC International Trustee Limited,
acting in its capacity as trustee of a family trust holds all the units in the private unit trust. The objects of the family trust include Mr. Lee
Seng Jin and Ms. Sham Yee Lan, Peggy.
Save as disclosed above, as at 30 September 2007, none of the Directors and chief executives of the Company had any interest or short
position in the shares or underlying shares or debentures of, or had been granted, or exercised any rights to subscribe for shares (or
warrants or debentures, if applicable) of, the Company and any of its associated corporations (within the meaning of Part XV of the SFO)
which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including

9Interim Report 2007/2008
interests or short positions which they were taken or deemed to have under such provisions of the SFO), or which had been recorded in
the register required to be kept under Section 352 of the SFO or as otherwise notified to the Company and the Stock Exchange pursuant to
the Model Code.
Other than those interests disclosed above, the Directors and chief executives of the Company also hold shares of certain subsidiaries of the
Company solely for the purpose of ensuring that the relevant subsidiary has more than one member.
At no time during the period was the Company, its holding company, its subsidiaries or its associated companies a party to any arrangement
to enable any Director or chief executives of the Company to acquire benefits by means of acquisition of shares in, or debentures of, the
Company and its associated corporations as defined in the SFO.
(b) Short positions in shares and underlying Shares of the Company
None of the Directors and the chief executive of the Company or their associates had any short positions in the Shares,
underlying shares and debentures of the Company or any of its associated corporation (within the meaning of Part XV of
the SFO) as recorded in the register required to be kept under Section 352 of the SFO or as otherwise notified to the
Company and the Stock Exchange pursuant to the Model Code.
(c) Share option scheme
At the special general meeting of the Company held on 26 February 2004, the shareholders of the Company approved the
adoption of a share option scheme (the “Option Scheme”) to comply with the requirements of Chapter 7 of the Listing
Rules. As at 30 September 2007, no option was granted under the Option Scheme. A summary of the terms and conditions
of the Option Scheme are set out below.
(1) Purpose
The purpose of the Option Scheme is to provide incentives to Participants (as defined below) to contribute to the
Group and to enable the Group to recruit high-calibre employees and attract human resources that are valuable to
the Group and any entity in which the Group holds any equity interest (the “Invested Entity”).
(2) Participants
All directors and employees of the Group and suppliers, consultants, advisors, agents, customers, service providers,
contractors, any member of or any holder of any securities issued by any member of the Group or any Invested
Entity.
(3) Maximumnumberofshares
The number of shares which may be issued upon exercise of all options to be granted under the Option Scheme
and any other share option scheme(s) of the Company must not exceed 0% in the nominal amount of the issued
share capital of the Company as at the date of adoption of the Option Scheme. The maximum number of Share
available for issue under the Option Scheme is 42,925,803 as at the date of this report.

20 Samson Paper Holdings Limited
(4) MaximumentitlementofeachParticipant
The maximum number of Shares issued and to be issued upon exercise of the options granted to any one
Participant (including both exercised and unexercised options) in any 2-month period shall not exceed one percent
of the Shares in issue as at the date of grant.
(5) Timeofexerciseofoption
An option may be exercised in accordance with the terms of the Option Scheme at any time during the period
to be notified by the Board to each grantee of the option at the date of grant provided that such period shall not
exceed the period of ten years from the date of grant but subject to the provisions for early termination of the
option as contained in the terms of the Option Scheme.
(6) The Eligible Person shall pay HK$.0 to the Company in consideration of the grant of an Option upon acceptance
of the grant of Option.
(7) Exerciseprice
The option price per share payable on the exercise of an option is determined by the Board and shall not be less
than the highest of
a) the closing price of the shares as stated in the daily quotations sheet of the Stock Exchange on the date of
grant;
b) the average closing price of the Shares as stated in the Stock Exchange’s daily quotations sheets for the five
business days immediately preceding the date of grant; and
c) the nominal value of a share on the date of grant.
(8) RemaininglifeoftheOptionScheme
The Option Scheme will remain in force until 26 February 204.

2Interim Report 2007/2008
SUBSTANTIAL SHAREHOLDERS’ INTERESTS AND SHORT POSITIONS IN THE SHARES, UNDERLYING
SHARES OF THE COMPANY

As at 30 September 2007, the interests and short positions of the shareholders of the Company other than a Director or chief
executives of the Company and their associates, in the shares and underlying shares of the Company as recorded in the register
which were required to be kept by the Company under Section 336 of the SFO were as follows:
Long position in the Shares
Name of shareholder Number of Shares
Approximate
percentage of interest
to total issued share
capital of the Company
Quinselle Holdings Limited 29,620,000 5.6%
HSBC International Trustee Limited (Note) 29,620,000 5.6%
Note : Quinselle Holdings Limited holds the 29,620,000 Shares in its capacity as trustee of a private unit trust. HSBC International
Trustee Limited, acting in its capacity as trustee of a family trust, holds all units in the private unit trust.
Save as disclosed above, the register which was required to be kept under Section 336 of the SFO showed that the Company had not been
notified of any interests or short positions in the shares or underlying shares of the Company as at 30 September 2007.
CONTINGENT LIABILITIES

The Company provided corporate guarantees on the banking facilities granted to its subsidiaries. The amount of such facilities
utilized by the subsidiaries as at 30 September 2007 amounted to HK$,04,328,000 (3 March 2007: HK$797,023,000).
CHARGE OF ASSETS

As at 30 September 2007, trust receipt loans of HK$277,265,000 (3 March 2007: HK$69,982,000) and bank loans of
HK$48,909,000 (3 March 2007: HK$30,33,000) were secured by legal charge on certain properties of the Group in Hong Kong.
AUDIT COMMITTEE

The Audit Committee of the Company (the “Committee”) was set up to review and provide supervision of the Group’s financial
reporting process and internal controls. The Committee has reviewed the Group’s unaudited interim report for the six months
ended 30 September 2007 before it was tabled for the Board’s approval. The review of the unaudited interim financial statements
was conducted in conjunction with the Group’s external auditors.
PURCHASE, SALE OR REDEMPTION OF SHARES

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

22 Samson Paper Holdings Limited
MODEL CODE FOR SECURITIES TRANSACTIONS

The Company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers (the “Model Code”) as the
Company’s code of conduct for dealings in securities of the Company by the Directors. Having made specific enquiry of all the
Directors, the Directors confirmed that they have complied with the required standard set out in the Model Code throughout the
accounting period covered by the interim report.
COMPLIANCE WITH THE CODE ON CORPORATE GOvERNANCE PRACTICES OF THE LISTING RULES
In the opinion of the Directors, the Company was in compliance with the Code of Corporate Governance Practices as set out in
Appendix 4 of the Listing Rules during the six-month period ended 30 September 2007 except that the non-executive Directors
were not appointed for a specific term but are subject to retirement by rotation and re-election at the Company’s annual general
meetings in accordance with the bye-laws of the Company.
BOARD OF DIRECTORS

As at the date of this report, the Board comprises five executive Directors, namely Mr. SHAM Kit Ying, Mr. LEE Seng Jin, Mr.
CHOW Wing Yuen, Ms. SHAM Yee Lan, Peggy and Mr. LEE Yue Kong, Albert, one non-executive Director, Mr. LAU Wang Yip,
Eric and three independent non-executive Directors, namely Mr. PANG Wing Kin, Patrick, Mr. TONG Yat Chong, and Mr. NG
Hung Sui, Kenneth.
By Order of the Board
SHAM Kit Ying
Chairman
Hong Kong, 2 December 2007