Qin Jia Yuan's strong performance during the six months ended March 31, 2005 was mainly driven by increased earnings from TV programme and marketing related income on the back of expanded hours of TV drama series from 35 hours of the corresponding period last year to 84 hours during the period.

Nielsen Media Research statistics indicate that China's advertising expenditure soared to RMB261.4 billion in 2004, an increase of 32% over 2003, of which 76% was accounted for by TV advertising. As most Chinese TV networks increased their listed rates by 10% to 20% at the beginning of this year, it is expected that there will be at least another 30% growth in advertising expenditure in 2005 year on year.

Dr Leung Anita Fung Yee Maria, CEO of Qin Jia Yuan, said: "TV dramas produced in China are gaining popularity not only domestically but also in overseas Chinese communities. We perceive good opportunity for business development as there will be more investments in TV dramas in the PRC. Since our listing in June 2004, we have shifted our focus to procurement of investment in large-scale, premium-quality TV dramas to further our branding and lead in the market. As China's media industry continues to evolve to meet new and exciting challenges ahead, we look forward to benefiting from the market growth by continuing to expand our TV programme production, distribution, trading and market promotion related services."

In the first half, "The Well （自流井）", a Chinese ancient costume TV drama was complete and ready for broadcasting. Another large scale TV drama was in post-production stage but had already generated TV programme support service income during the period.

The Group is also looking into the possibility and feasibility of setting up joint ventures or strategic partnerships with both advertising companies and production houses to strengthen its one-stop media services to clients. It will consider companies with sound track records and working relationship with the Group.

"Script is the cornerstone of a good TV drama and quality scripts are always in great demand. During the period, we have acquired the intellectual property rights to a number of scripts and story concepts, rights to adapt novels of a renowned novelist into TV drama series, and have engaged a number of renowned script writers and editors in China and Hong Kong to work exclusively for us. With abundant source of good quality scripts and story concept on hand and script writers/editors available, we can offer a wider choice for investors and are in a better position to secure good production teams. This will also facilitate our long-term planning in securing investors and production teams for large-scale projects," continued Dr Leung.

As at March 31, 2005, the Group had cash and bank balances of HK$83.7 million (September 30, 2004: HK$113.1 million. Gearing ratio, or total liabilities over total assets, was 28% (September 30, 2004: 20%).

About Qin Jia Yuan
Qin Jia Yuan Media Services Company Limited (HKEx: 2366) is a China-focused one-stop shop for TV media services, providing integrated programme, distribution, advertising and marketing and public relations services to production houses, advertising agencies and advertisers. The Group was listed on the main board of the Stock Exchange of Hong Kong on June 30, 2004 following a successful initial public offering. Its strategic shareholders include Aegis Group plc, a public company listed on the London Stock Exchange and one of the world's five largest media groups.

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