LARK DISTILLING CO. LTD — Capital/Financing Update 2005

Aug 29, 2005

Montec International Limited ABN: 62 104 600 544

Level 6, 55 York Street Sydney NSW 2000 Australia

montec@montec-international.com www.mnnter-international.com

Telephone: +61 2 9299 0011 Facsimile: +61 2 9299 1499

ASX/Media Release

30 August 2005

MONTEC PRODUCTS - NATIONAL ROLLOUT CHINA

Montec International Limited ("Montec") is pleased to announce that the first stage of its national product rollout within China commenced with the first delivery of Montec's Meng Tai brand to the southern city of Shenzhen.

This first delivery of 20 metric tonnes of finished Meng Tai product sold to the National Agency Network (NAN) for the Shenzhen market is solely for supermarket shelving by NAN. At last count, the Meng Tai product is on retail shelves in 22 of the 78 major stores in the Shenzhen city that are awaiting stock.

The initial shipments for the Shenzhen market are being processed under arrangements with Tianjin Haihe Dairy. Shipment sizes are strictly managed to optimise the currency of product production and use by dates and accordingly repeat orders follow to aid this logistic requirement.

Montec's international brand "dairvoure" will be produced in UHT by the end of the year for delivery to the major cities of Shanghai followed by Beijing in Northern China. The initial stores in Shanghai that are expecting dairypure stocks by the end of the year against firm orders from agents and scheduled production are Carrefour, Metro Hymall, Walmart, Citysupermarket, Pines, Parkson, Le-Go, Ou Shang, Mai De Long, Shi Dai, Qian Ja Hui, Shan Mu Shi and Le Ke Duo. All of these stores are chains and therefore comprise of multiple stores. The initial order to commence stocking these stores is sixty (60) metric tonnes and comprises only two Stock Keeping Units (1 litre and 250ml plain - UHT). This will be followed by UHT flavoured milk and in the new year, fresh milk in 1.5 litre PET plastic and fresh dairypure yoghurt.

Once these two cities and the surrounding regional cities thereof have attained distribution, they will represent greater than 50% of Montec' national target market potential so far as sales and building value in the brands is concerned. These products will be mainly processed by Beijing Sanyuan Foods (BSF).

Montec is ensuring that it maximises order aggregation for production via BSF so as to:

• meet the minimum run requirements of 60 metric tonnes due to the scale of the production equipment; and
• to capitalise on the recent agreement reached with BSF whereby they will purchase the milk fat off take which is extracted from the raw milk during the production process, rather than Montec being required to meet the cost of milk fat disposal.

The agreement with BSF and Shanghai Sanyuan for the production and rollout of fresh monounsaturated milk under the "dairypure" brand in the new year will allow the benefits of the marketing spend directed to support the UHT category of the dairy section within supermarkets to also extend to the fresh dairy foods cabinet. The separation of UHT milk from fresh milk requiring refrigeration within stores is similar in China to that which exists within supermarkets in Australia. This new development allows Montec to gain greater exposure for its product offerings to consumers through the dual display regime. The dual display brings additional credibility to the offerings through the ability to offer wider product choice for customers.

Ends

For further enquiries: Malcolm Campbell Managing Director 02 9299 0011

Terry Cuthbertson Chairman 02 9299 0011