1

March 2009

Annual Results Announcement

2008

2

Agenda

Financial Highlights

Business Review

Strategies and Plans

Open Forum

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Financial Highlights

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Financial Highlights

(RMB '000) 2008 2007 Change (%)

Turnover 4,822,596 3,655,613 +31.9%

Gross profit 1,149,072 813,860 +41.2%

Profit attributable to equity holders

699,380 406,882 +71.9%

Basic EPS (RMB cents) 56 cents 33 cents +69.7%

Final dividend (HK cents) 20 cents 16 cents +25.0%

For the year ended 31 December

Dividend payout ratio: 32.1%

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Sustainable Turnover & Profit Growth

406.9

699.4

2007 2008year ended 31 Dec

RMB Mn

Profit Attributable to Equity Holders

4,822.6

3,655.6

2007 2008year ended 31 Dec

RMB Mn

Turnover

yoy:+31.9

%

yoy:+31.9

%

yoy: +71.9%

yoy: +71.9%

Satisfactory growth in turnover :- Continuous and significant increase in the sales of

sports wear- Successful expansion into the global distribution market- Acceleration of the exploration of the domestic market

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Growing Margins

1149.1

813.9

600

800

1,000

1,200

1,400

2007 2008

21.5%

22.0%

22.5%

23.0%

23.5%

24.0%

GP GPMyear ended 31 Dec

Gross ProfitGross Profit

Improving gross profit margin:- Effective adjustment in product mix- Further enhancement of production efficiency

Net profit margin increased by 3.4 pct, due to- One-off gain: RMB128.2 million recorded from the forward currency contracts- Strong organic growth: NP increased by 43.2% if excluding the one off gain

from the forward currency contract

699.4

406.9

200

300

400

500

600

700

800

2007 2008

10.0%

11.0%

12.0%

13.0%

14.0%

15.0%

NP NPMyear ended 31 Dec

Net ProfitNet Profit

RMB Mn

22.3%

23.8% 14.5%

11.1%

RMB Mn

582 。7

NP excl one off gain

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Turnover Breakdown by Products

For the year ended 31 Dec2008 2007 Change

RMB'000 % RMB'000 % RMB'000 %

By products

Casual wear 2,398,304 49.7% 2,248,981 61.5% 149,323 6.6%

Sports wear 2,042,315 42.3% 1,165,198 31.9% 877,117 75.3%

Lingerie 248,929 5.2% 147,920 4.0% 101,009 68.3%

Other knitting products 133,048 2.8% 93,514 2.6% 39,534 42.3%

Total 4,822,596 100% 3,655,613 100% 1,166,983 31.9%

Significant growth in sports wear contribution was attributable to continuous increase in OEM operation for renowned sports brands (Adidas, Nike and Puma) as a result of increasing proportion of high-end products.

Increase in sales of casual wear as a result of improving product quality, and shorten delivery turnover

Substantial Growth in sports wear and lingerie wear has enriched the Group’s product portfolio

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Stable growth contribution by Japan market

The European market and other markets (Hong Kong, Korea and Australia) recordedimpressive growth as a result of successful market diversification strategy and global market demand from certain customers

Declining contribution by the US market as affected by economic turbulence

Growth in domestic sales was driven by increasing demand of high-end sports apparel from renowned brand names

Turnover Breakdown by Regions

year ended 31 Dec

2008 2007 Change

RMB'000 % RMB'000 % RMB'000 %

Japan 2,437,304 50.5% 2,178,725 59.6% 258,579 11.9%

Europe 751,442 15.6% 515,602 14.1% 235,840 45.7%

United States 261,079 5.4% 298,830 8.2% (37,751) (12.6%)

Other countries 455,497 9.5% 268,112 7.3% 187,385 69.9%

Domestic market 917,274 19.0% 394,344 10.8% 522,930 132.6%

Total 4,822,596 100% 3,655,613 100% 1,166,983 31.9%

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Healthy Financial Position

2008 2007

Inventory turnover days 71 72

Debtor turnover days 31 26

Creditor turnover days 29 38

For the 12 months ended 31 Dec

2008 2007

Gearing ratio (debt to equity) (%) 29% 32%

Cash and Cash Equivalent (RMB Mn)

238 233

Net assets (RMB Mn) 2,873 2,481

Total assets (RMB Mn) 4,321 3,904

For the 12 months ended 31 Dec

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Business Review

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Strengthened Management in Lean Manufacturing

For the year ended 31 December

2005 2006 2007 2008

Weaving and knitting (in tons)

30,782 35,247 43,749 53,016

Dyeing and finishing(in tons)

38,003 43,610 53,363 61,568

Printing and embroidery(in thousand pieces of fabric)

30,966 63,792 68,915 106,310

Cutting and sewing(in thousand pieces of apparel)

77,699 95,446 112,446 138,063

Continuous measures on technological reform, equipment upgrade and technology optimization have reduced our consumption on energy and water resource throughout our manufacturing process

Effectively controlled its production cost by enhancing its internal control

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Casual wear customers

Prominent progress on our strategy to fine-tune the customer base. Two renowned sports wear customers, ADIDAS and NIKE, account for [33]% (2007: 25%) of Group’s total turnover, with trend showing strong sales growth, effectively reduced Group’s reliance on single client.

Growing contribution by lingerie, with growing number of lingerie customers.

More Reasonable Customer Base

Sports wear customers

Lingerie and other customers

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Rational Layout of the Sales Markets

Further consolidated and developed strengthen Japan market Japan

Further consolidated and developed strengthen Japan market Japan

Continuous rapid growth momentum of the domestic market, as a result of [increasing demand for renowned sports brand wear]

Continuous rapid growth momentum of the domestic market, as a result of [increasing demand for renowned sports brand wear]

Significant growth in the sales to other markets, which include Korea, Hong Kong, China and Australia due to [increasing demand for high end textile products]

Significant growth in the sales to other markets, which include Korea, Hong Kong, China and Australia due to [increasing demand for high end textile products]

Rational layout of sale markets lowered the

influence of a single market on

the Group’s operation

Rational layout of sale markets lowered the

influence of a single market on

the Group’s operation

Removal of quotas system for China’s textile imports by EU in 2008, resulting in a strong sale growth of 45.7% from that market

Removal of quotas system for China’s textile imports by EU in 2008, resulting in a strong sale growth of 45.7% from that market

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Strategies and Plans

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Optimization of Vertical Integration & Expansion of Production Capacity

Expansion of production capacity

Optimization of vertical integration

Seek for other opportunities for the construction of new plant

Optimize each production procedure, and strengthen the coordination and cooperation

expand our garment production capacity by improving the efficiency of the existing equipment

Ensure the full utilization of the productivity of the factories, further improvement of the production efficiency and completion of the new garment factory

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Enhancement of R&D & Focusing on higher-end textile products

Increase the investments in product research and development and promote high-end development of products

Fully leverage on the competitive edges of the Group in fabric developments achieve optimal performance in sales of sports wear and lingerie

Consolidate the competitiveness of its products in the consumer market by adhering to product diversification and improving the product quality

Pls provide pics of some new (higher-

end) textile products

Casual wearCasual wearSports wearSports wear

Lingerie wearLingerie wear

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Enhancement of Customer Service &Optimization of Structure of Production Base

Ningbo

Quzhou

Anhui

Cambodia

Better ancillary services, including shortening the delivery turnover of the products and providing examination services of the products

Focus on the production procedures with high added value, technology intensive, high resource consumption and high requirements to the ancillary facilities in the coastal area

Shift certain of the cutting and sewing procedures to the labour intensive central area

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Europe

Asia (incl the PRC, HK &

Korea)

US

Expansion into global distribution markets

Consolidate and further develop the market in Japan

Concentrate on the development of the distribution market in the PRC

Achieving a balanced development in the EU, the US, Korea and Australia

Australia

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Mission

The Most Competitive Knitwear Manufacturer In

the World

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Open Forum