Hong Kong, January 16, 2002 - Gold, jewellery and precious metal products manufacturer Hang Fung Gold Technology Limited (SEHK: 870) today announces that it intends to reduce the entire share premium account to zero by cancelling the entire amount standing to the credit of the share premium account. As at today, the amount standing to the credit of the share premium account was HK$328,220,000.

The cancelled amount will be transferred to the contributed surplus account of the Company, and to set off against the accumulated deficit of the Company as at March 31, 2001 of HK$200,693,000. Upon such set off, the balance of the amount standing to the credit of the contributed surplus amount will be in the range of HK$286,128,000 and HK$317,313,000. The Company's net worth will remain unchanged.

Mr Lam Sai Wing, Chairman, Hang Fung Gold Technology explained: "This proposal will enable us to declare dividends to our shareholders at an earlier opportunity, and to make a distribution to shareholders out of the contributed surplus account as and when we consider appropriate."

In the six months ended September 30, 2001, the Group recorded profits attributable to shareholders of HK$22,405,000 on a turnover of HK$618,153,000 which surged over 43.5% compared with the corresponding period last year.

"For the second half, we continue to hold a very positive view on the China market, which is a major business driver for us. To cement our growth, we are also committed to the continued development and implementation of new production technology, and enhancing our brand equity," continued Mr Lam.

Hang Fung Gold Technology Limited (SEHK: 870) is one the largest jewellery manufacturers in Hong Kong with production facilities covering over 200,000 square feet in Hong Kong and Sha Tou Kok and a strong staff of over 2,000. It is a highly diversified enterprise integrating advanced technological manufacturing processes with quality designs and professional services. With over 20 years of experience in the industry, it has established a solid reputation worldwide as a leading manufacturer of gold, jewellery and precious metal products.

Issued by :
Hang Fung Gold Technology Limited

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