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SUMMARY The directors ("Directors") of Yue Yuen Industrial (Holdings) Ltd ("Yue Yuen") announce the unaudited consolidated profit of Yue Yuen and its subsidiaries (the "Group") for the nine months ended 30th June, 1999. This announcement is made as part of Yue Yuen's current practice to publish its quarterly financial results. The unaudited profit attributable to shareholders of Yue Yuen for the nine months ended 30th June, 1999 was approximately US$ 148.1 million. There may be a possible private placement of new shares in Yue Yuen to mainly independent institutional investors in the USA, Europe and Asia. The expected size of the placement is between US $100 - 150 million (approximately HK$780 - 1,170 million). The number of shares to be issued and the issue price have not been determined but the issue price will be set with reference to the then market price. Discussions with Yue Yuen's financial advisers are on-going and it is hoped that a placing, if it proceeds, will complete on or before 31st December, 1999. The placing may or may not proceed. Investors are advised to exercise caution when dealing in the shares of Yue Yuen. Further announcement will be made as and when appropriate.

Unaudited financial results for the nine months ended 30th June, 1999

The Directors of Yue Yuen are making this announcement of the Group's unaudited consolidated profit for the nine months ended 30th June, 1999 in line with its current practice to publish the Group's quarterly financial results.

                                                 Nine months ended
                                        30th June, 1999   30th June, 1998
                                              Unaudited         Unaudited
                                                US$'000*          US$'000*

Turnover                                      1,123,649         1,081,208
Cost of Sales                                   814,904           807,129
                                              ---------         ---------
Gross Profit                                    308,745           274,079
                                              =========         =========
Operating Profit                                150,473           129,724
Share of Profits of Jointly
  Controlled Entities                             2,652             1,793
                                              ---------         ---------
Profit from Ordinary Activities
  before Taxation                               153,125           131,517
Taxation                                         (4,544)           (2,525)
                                              ---------         ---------
Profit before Minority Interests                148,581           128,992
Minority Interests                                 (459)             (188)
                                              ---------         ---------
Profit Attributable to Shareholders             148,122           128,804
                                              =========         =========

* The reporting currency of the Group is United States Dollars

The Directors hereby confirm that the Group's audited annual results for the year ended 30th September, 1999 will be announced in accordance with the requirements set out in the Listing Agreement with The Stock Exchange of Hong Kong Limited i.e. on or before 29th February 2000.

POSSIBLE PLACEMENT

The Directors also wish to announce that Yue Yuen has appointed Goldman Sachs (Asia) L.L.C. and Barits Securities (Hong Kong) Limited to advise Yue Yuen on a possible private placement of new shares in Yue Yuen mainly to independent institutional investors in the USA, Europe and Asia. The expected size of the placement is between US$100 - 150 million (approximately HK$780 - 1,170 million). The number of shares to be issued and the issue price have not been determined but the issue price will be set with reference to the then market price. Discussions with Yue Yuen's financial advisers are on-going and it is hoped that a placing, if it proceeds, will complete on or before 31st December, 1999.

If the placing proceeds, Yue Yuen intends to issue the new shares pursuant to the general mandate granted to its Directors in Yue Yuen's last annual general meeting held on 12th March 1999.

Yue Yuen intends to do the placement with a view to using the proceeds therefrom for a number of purposes, including additional capital expenditure to increase its shoe-manufacturing capacity in the People's Republic of China, Indonesia and Vietnam, as well as for potential strategic acquisitions of businesses which complement its core business of shoe manufacturing.

Yue Yuen has not signed any agreement committing itself to the placing. The proposed placing is subject to a number of factors, including market conditions. The proposed placing may or may not proceed.

Investors are advised to exercise caution when dealing in the shares of Yue Yuen.

Further announcement will be made if and when appropriate.

By the Order of the Board
Tsai Chi Neng
Chairman

Hong Kong, 30th August, 1999

For shareholders' information, US$ has been translated into HK$ at the rate of US$1 to HK$7.80.

This announcement is not an offer of securities for sale in the United States. Shares may not be offered or sold in the United States absent registration or an exemption from registration. If the placing proceeds, any public offering of shares to be made in the United States will be made by means of a prospectus that may be obtained from the issuer or selling security holder and that will contain detailed information about the company and management, as well as financial statements. The company does not intend to register the placement of shares under the U.S. Securities Act of 1933 if the placing proceeds.

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