SINGAMAS CONTAINER HOLDINGS LIMITED
(Incorporated in Hong Kong with limited liability)
Website: http://www.irasia.com/listco/hk/singamas

FINANCIAL HIGHLIGHTS Profit up by 40% to US$3,424,000 Net profit margin jump from 1.7% to 2.5% Container manufacturing operations increased overall production by 23.8% to 100,833 TEUs. The Group's container depot operations in the People's Republic of China achieved outstanding performance.

ANNUAL RESULTS The Directors of Singamas Container Holdings Limited (the "Company") are pleased to announce the consolidated results of the Company and its subsidiaries (together the "Group") for the year ended 31st December, 1999 as follows: Notes 1999 1998 US$'000 US$'000 Turnover 2 138,056 147,597 ========= ========= Profit from operations 4,073 4,278 Share of results of associates 599 362 --------- --------- Profit before taxation 4,672 4,640 Taxation 3 (318) (655) --------- --------- Profit after taxation 4,354 3,985 Minority interests (930) (1,540) --------- --------- Net profit for the year 3,424 2,445 ========= ========= Earnings per share 4 0.75 cent 0.54 cent ========= ========= Notes: (1) Change in accounting policy In the current year, the Group has adopted Statement of Standard Accounting Practice 1 "Presentation of financial statement" ("SSAP1") issued by the Hong Kong Society of Accountants. In prior years, pre-operating expenditure was capitalised and amortised, on a straight line basis, over a period of five years from the date of commencement of commercial operation of the subsidiaries. The adoption of SSAP1 has led to a re-assessment of this accounting policy. In particular, pre-operating expenditure is not considered to give rise to an identifiable resource from which economic benefits are expected to flow to the Group. Accordingly, such expenditure is now recognised as an expense in the period in which it is incurred. This change in accounting policy has been accounted for retrospectively. The effect of this adjustment has been to increase accumulated losses of the Group at 1st January, 1998 by US$2,673,000, and to increase the profit for the year ended 31st December, 1999 by US$976,000 (1998: US$897,000). The comparative statements for 1998 have been restated to conform to the changed policy. (2) Turnover Turnover represents revenue from container manufacturing, container depot and mid-stream operations. (3) Taxation Hong Kong profits tax has been provided at the rate of 16% (1998: 16%) on the estimated assessable profit for the year. Taxation on overseas profits has been calculated on the estimated assessable profit for the year at the rates of taxation prevailing in the countries in which the Group operates. The taxation charge is made up as follows: 1999 1998 US$'000 US$'000 Company and subsidiaries Hong Kong profits tax - 3 Overseas taxation 318 659 Deferred tax - (7) ---- ---- 318 655 ==== ==== (4) Earnings per share The calculation of earnings per share is based on the net profit of US$3,424,000 (1998: US$2,445,000) and 456,001,760 ordinary shares in issue (1998: 456,001,760 ordinary shares) throughout the year. Diluted earnings per share is not presented as the exercise price of the Company's outstanding share options was higher than the average market price of shares for both 1999 and 1998. The adjustment to comparative earnings per share, arising from the change in accounting policy shown in note 1 above, is as follows: Reconciliation of 1998 earnings per share: US cent Reported figure before adjustment 0.34 Adjustment arising from the write off of pre operating expenditure 0.20 ------- Restated 0.54 =======

BUSINESS REVIEW

The Group recorded a turnover of US$138,056,000 which was 6.5 per cent lower than the previous year. However, total consolidated net profit increased substantially to US$3,424,000, 40 per cent higher than the previous year's figure of US$2,445,000. This positive result was mainly attributable to the outstanding performance of the Group's container depot operations in the PRC.

Container manufacturing operations

Accounting for approximately 79.5 per cent of the total turnover, container manufacturing remained the Group's core business and recorded sales of US$109,812,000.

• Though the industry witnessed a severe imbalance of trade flow and increase in raw material costs in the first half of 1999, the business environment improved in the second half of the year.

• Performance was affected by the drop in average selling price of dry freight containers. If fell from 1998's US$1,600 per twenty-foot equivalent unit ("TEU") to US$1,475 in 1999

• In order to capture a larger market share and achieve economy of scale, the Group increased its overall production by 23.8 per cent from 81,422 TEUs in 1998 to 100,833 TEUs in 1999.

• On 16th July, 1999, the Company entered an agreement with Shun An Da Container Manufacturing Co., Ltd. ("Shun An Da"), to take over the operation and management of this container-manufacturing factory. The inclusion of Shun An Da strengthened the Company's business growth and competitiveness by establishing a wider manufacturing network in the PRC.

Container depot operations

During the year under review, container depot and terminal operations achieved a turnover of US$20,261,000.

• With increased container throughput in the PRC, the Group's depot operations in the PRC experienced robust growth.

• The Company signed a joint venture agreement to invest in Dalian Singamas International Container Co., Ltd. ("DSIC") on December 24th 1999, and will take over the management in April 2000. The addition of DSIC will further enhance the Group's container depot network.

• The Group now operates six container depots in the PRC located from the north to the south of the coastal cities in Dalian, Tianjin, Qingdao, Shanghai, Ningbo and Xiamen, which will further strengthen the Company's presence and market position in the PRC.

Mid-Stream Operation

The mid-stream operation managed to achieve sales of US$7,983,000 and profit before taxation and minority interests of US$1,167,000. Good performance was mainly due to the improvement in efficiency and better container throughput.

PROSPECTS

• With the recovery of shipping industry, together with the rising trade volume in the region, it is expected to increase the container demand and business opportunities for the Group's container manufacturing and depot business, especially in the PRC.

• The Group will continue to explore further opportunities to extend the manufacturing network by joint co-operations or acquisitions of factories in strategic locations.

• Container depot operations in the PRC experienced considerable growth in 1999 and the management is confident that the upward trend will continue in 2000.

• The Group is currently establishing an e-commerce business model, an online system to conduct business electronically. The system will be installed in all of the Group's factories, container depots and mid-stream operation.

YEAR 2000 ("Y2K") COMPLIANCE

A comprehensive plan to address the Y2K issues was implemented in mid-1998 and completed on September 1999. As of the date of this announcement, no Y2K related problems were found that would have a material adverse effect on our businesses. Nevertheless, the Directors will continue to monitor the Y2K issue to ensure that the Group's operations are not adversely affected.

AUDIT COMMITTEE

Pursuant to the requirements of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited ("Listing Rules"), an Audit Committee of the Company was established on 24th August, 1998 with reference to "A Guide for the Formation of an Audit Committee" issued by the Hong Kong Society of Accountants in December 1997. During the year under review, the Committee met twice.

The Audit Committee is answerable to the Board and the principal duties of the Committee include the review of the Company's financial reporting process and internal controls.

TRANSFERS FROM RESERVES

Pursuant to the legal requirements in the PRC and the appropriation agreed in the subsidiaries and an associate, aggregate amounts of US$107,000 and US$91,000 have been transferred to general reserve and development reserve of the Group respectively during the year.

DIVIDEND

Due to available cash resources are required to finance the Group's working capital requirements, the Directors do not recommend the payment of a dividend for the year ended 31st December, 1999.

CLOSURE OF REGISTER OF MEMBERS

The Register of Members of the Company will be closed from 13th June, 2000 to 19th June, 2000, both days inclusive, during which period no transfer of shares will be effected.

In order to determine entitlement to attend and vote at the annual general meeting, all transfer of shares, accompanied by the relevant share certificates, must be lodged with the Company's Share Registrars, Central Registration Hong Kong Limited of 17th Floor, Hopewell Centre, 183 Queen's Road East, Hong Kong for registration by not later than 4:00 p.m. on 12th June, 2000.

PURCHASE, SALE OR REDEMPTION OF LISTED SECURITIES

During the year, neither the Company nor any of its subsidiaries has purchased, sold or redeemed any of the Company's listed securities.

By Order of the Board
Chang Yun Chung
Chairman

Hong Kong, 27th April, 2000

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