The market in the first half of 2009 was seriously impacted by the financial tsunami; although the economic situation was gradually stabilized in the second half of the year, the road to recovery is still rough. The Company took orders of the management philosophy of steady development, continuously kept a good financial position and constantly improved the quality of management and the risk resistant ability, aiming to effectively managing the impact from this global financial crisis.

Hi-tech Manufacturing

In 2009, the turnover of the hi-tech manufacturing business of the Company was HK$1,349,114,000 (2008 : HK$1,683,081,000), representing a decrease of approximately 19.84% as compared with last year. The result of the hi-tech manufacturing business was HK$143,042,000, representing a decrease of approximately 21.67% as compared with HK$182,611,000 in last year. The plastic products and the printed circuit boards businesses have their key markets in the United States and Europe where major customers are located. In the presence of the economy recovery in the second half of the year, the orders from our customers quickly rebounded and the sales performance in recent months has gradually restored to near the level before the outbreak of the financial tsunami. The intelligent chargers and the liquid crystal display businesses were badly affected by the financial tsunami and their operating conditions are yet to be recovered. On the whole, although the hi-tech manufacturing business was subject to a tough test in the first half of the year, the situation in the second half of the year has gradually stabilized and begun to restore to growth, the situation in the results of the full-year was better than expectation.

Shenzhen Aerospace International Centre

Shenzhen Aerospace International Centre has been progressing smoothly since its inception. Shenzhen Aerospace Hi-Tech Investment Management Company Limited (“Shenzhen Aerospace”) has completed the design proposal for construction and obtained the governmental approval. It has also acquired several approvals and permits for planning and construction and has completed the preparation of project work plan, including project proposal, expansion and commencement plan design, construction design, etc. The completed works included geological inspection, geological safety assessment and earthquake faults investigation, etc. Shenzhen Aerospace has also established a series of internal management system and strengthened the management in project quality, safety and cost control, etc, so as to support the large scale of construction tenderings and project management in the future.

The Complex Zone of the Launching Site in Hainan Province

After entering into the “Agreement of the Land Development Project of the Complex Zone of the Launching Site in Hainan Province” between the Company and the Wenchang Government, Hainan Province in August 2008, its preliminary works had commenced subsequently. The Company has established a project company named Hainan Aerospace Investment Management Company Limited (“Hainan Aerospace”) and invested an upfront capital funding in it and formed an operation team. At present, the Master Plan of the Complex Zone of the Launching Site in Hainan Province has been approved by the provincial government and the entire comprehensive development project has been considered as a key project in the province, as well as a key cultural industrial park and a key cultural industrial project.

During the year, internationally renowned architects, theme park designers and property consultants have been engaged by Hainan Aerospace to form a syndicate of specialists and are working together for the planning and design of the aerospace theme park and the entire Complex Zone. After a year of efforts, the relevant works have been basically completed. Currently, the approval for controlling detailed planning of the entire Complex Zone is being applied. At the same time, Hainan Aerospace is working closely with the Wenchang Government for the joint research and formulation of a program concerning the expropriation of the entire Complex Zone. As of the date of this Announcement, the expropriation has been commenced and it is expected that the relevant works will be completed within 2010. The Company is endeavor to beginning with the construction of infrastructure projects by the end of the year.

In order to match up the development of new development strategy, the Company gained a profit before taxation of approximately HK$43,551,000 by selling its 80% interest held in Shanghai Aerospace Technology Investment Management Limited (“Shanghai Aerospace”) during the year at a consideration of RMB192,370,000 (approximately HK$218,107,000).