Hong Kong, July 22, 2001 - Toys and motors manufacturer Kin Yat Holdings Limited (SEHK : 638) recorded a 53% increase in total turnover to HK$811,561,000 for the year ended March 31, 2001. Net profit for the year declined slightly by 2% to HK$84,692,000. For the toys division, the rise in costs of raw materials and a shortage of electronic components during the year have resulted in a 20% drop in profit after finance costs to HK$65,470,000, on a turnover of HK$603,105,000. The Group's diversification into motors manufacturing has proved to be a correct move as this new Group member registered HK$28,288,000 in profit after finance costs, and a turnover of HK$134,952,000. The Group declared a final dividend of HK7 cents.

In the face of an industry-wide slowdown, toys companies continued to tighten control over inventory levels, further shortening the production lead-time. Production costs went up as a result, leading to a decline in the gross profit margin for the toys operation from the 25% of the previous year to 20% for fiscal 2000/01. In addition to maintaining tighter controls on production costs, the Group has responded to these market conditions by aggressive business development initiatives. Last year, the Group successfully clinched notable contracts from several new clients.

During the year, the Group has invested over HK$10 million in expanding facilities in Shaoguan, in line with its long-term plan to move its production northwards, from Shenzhen to Shaoguan.

"We have invested over the past years to diversify our business portfolio in order to strengthen the base of our long-term growth. The investment in a motors manufacturing operation has paid off last year with significant profit contribution. We are confident that the motors operations will drive our growth in the next few years," said Mr Raymond Cheng Chor-kit, Chairman of Kin Yat Holdings.

Standard Motor, in which the Group holds a 70% stake, demonstrated strong growth in both turnover and net profit last year. In addition to maintaining steady growth for the toys line, the division also commenced the development of a new line of motors for personal care products. Approval has already been granted by major brand-name from whom trial orders were received. Management anticipates that this trial programme will be upgraded to mass production in 2002/03.

The Group's investment in 33% interest in Concord, a CDR producer is held in reserve, pending its future expansion of production capacity. Concord recorded a loss of HK$9,600,000 last year (of which HK$3,200,000 was absorbed by the Group) due to severe price competition as well as the inadequate scale of production in Hong Kong caused by the delay in the planned facilities relocation to Mainland China. Concord's loss incurred was also largely attributable to the depreciation of machinery and the writing off of initial set up costs, which accounting for 70% of the operation's loss for the year, did not have any negative impact on the operation's cash flow position.

With the prices of CDRs stabilizing and the gradual replacement of floppy diskettes by CDRs, Concord is expected to record improved results in the coming year. The Group will also continue to assist Concord in seeking approval for the relocation of its manufacturing facilities to Mainland China, where the division is able to establish a cost-effective production base on an optimal scale. Faster-paced developments are anticipated following the granting of approval for production in China.

Kin Yat Holdings Limited (SEHK : 638) develops and manufactures electronic, high value-added toys. To diversify the base for its long-term growth, the Group has invested in a portfolio of motors and CDR manufacturing operations.

Year ended March 31,
	2001	2000
	HK$ '000	HK$ '000
Turnover	811,561	529,957
Toys	603,105	469,420
Motors	134,952	10,922
Others	73,504	49,615
Net Profit Attributable to Shareholders	84,692	86,259
Profit after finance costs	103,663	95,719
Toys	65,470	81,422
Motors	28,288	487
Others	9,905	13,810
Final dividend per share	HK7 cents	HK7 cents
Earnings per Share
- Basic	HK22.42 cents	HK23.19 cents
- Fully Diluted	HK21.81 cents	HK22.30 cents

Issued by :
Kin Yat Holdings Limited

Through :
Troika Communications Limited
Jenny Lee or Angus Ho
tel: 2511 8388 / fax: 2511 8238
email: enquiry-at-t6pr.com (use "@" to replace "-at-")
URL : http://www.t6pr.com