Persistence Gold Group Ltd — M&A Activity 2002

Feb 21, 2002

The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this announcement, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

YING WING HOLDINGS LIMITED

(Incorporated in Bermuda with limited liability)

Discloseable and connected transaction

in relation to the disposal of the

entire interest in the Snack Food Business Companies (the “Disposal”)

and special deal under Rule 25 of the Takeovers Code

Despatch of Circular

Copies of the Circular in relation to the Disposal will be despatched to Shareholders on 22nd February, 2002. The SGM to approve the Disposal by the Independent Shareholders on vote by way of a poll will be held on 11th March, 2002.

Included in the Circular there are information relating to the unaudited consolidated income statement of the Group for the 11 months ended 30th November, 2001 and the unaudited consolidated balance sheet of the Group as at 30th November, 2001, which are set out below for the information of the public.

Reference is made to the announcement dated 25th January, 2002 (the “Announcement”) jointly issued by the Company and Angel Field in relation to, inter alia, the Offer and the Disposal.

Defined terms and expressions used herein shall have the same meanings as those in the Announcement unless otherwise stated.

Despatch of the Circular

The Board announces that copies of the circular of the Company (the “Circular”) containing, inter alia, (i) the letter from the Board; (ii) the letter from the independent board committee of the Company; and (iii) the letter of advice from AMS Corporate Finance Limited and Hantec Capital Limited (the joint independent financial advisers to the independent board committee of the Company), in connection with the Disposal will be despatched to the Shareholders on 22nd February, 2002.

A special general meeting of the Company (the “SGM”) to approve the Disposal by the Independent Shareholders on vote by way of a poll will be held on 11th March, 2002. Shareholders are advised to review the letter of advice from AMS Corporate Finance Limited and Hantec Capital Limited before voting at the SGM.

Unaudited financial information

Included in the Circular there are information relating to the unaudited consolidated income statement of the Group for the 11 months ended 30th November, 2001 and the unaudited consolidated balance sheet of the Group as at 30th November, 2001, which have not been disclosed to the public before.

The aforesaid unaudited financial information are set out below for the information of the public:

Unaudited consolidated income statement of the Group for the 11 months ended 30th November, 2001

	Notes	HK$’000
Turnover	1	38,557
Cost of sales		(46,234	)
Gross loss		(7,677	)
Other revenue		836
Distribution costs		(7,121	)
Administrative expenses		(11,213	)
Other operating expenses	2	(20,629	)
Loss from operations		(45,804	)
Interest on bank borrowings
wholly repayable within five years		(1,132	)
Loss before taxation		(46,936	)
Taxation	3	-
Loss before minority interests		(46,936	)
Minority interests		1,537
Loss attributable to Shareholders	4	(45,399	)

Notes:

1.	Turnover
		HK’000
	Snack Food Business Companies	25,017
	Fabric Group	13,540
		38,557
2.	Other Operating expenses
		HK$’000
	Loss on disposal of fixed assets	11,654
	Bad debt written off	4,975
	Provision for doubtful debts	4,000
		20,629

3.	Taxation
	No provision for Hong Kong Profits Tax has been made as the Group had no assessable profits arising in Hong Kong during the 11 months ended 30th November, 2001.
	No provision for the PRC enterprise income tax has been made as the Company’s PRC subsidiaries had no assessable profits for the 11 months ended 30th November, 2001.
	The Group had no significant unprovided deferred taxation for the period or at the balance sheet date.

4.	Loss attributable to Shareholders
		HK$’000
	Snack Food Business Companies	22,630
	Fabric Group	22,769
		45,399

5.	Depreciation and amortisation
	During the period, depreciation and amortisation of HK$8,978,000 was charged in respect of the Group’s property, plant and equipment and amortisation of HK$1,583,000 was charged in respect of the Group’s intangible assets.

Unaudited consolidated balance sheet of the Group as at 30th November, 2001

	Notes	HK$’000
Non-current assets
Property, plant and equipment		99,961
Current assets
Inventories		4,317
Trade and other receivables	2	20,782
Bank balances and cash		341
		25,440
Current liabilites
Trade and other payables	3	21,569
Amount due to a director		48
Taxation payable		12,656
Bank borrowings - due within one year	4	20,057
		54,330
Net current liabilities		(28,890	)
Total assets less current liabilities		71,071
Minority interests		5,397
		65,674
Capital and reserves
Share capital		20,000
Share premium	5	37,164
Special reserve	5	(14,980	)
Accumulated profits	5	23,490
		65,674

Notes:

1.	Principal accounting policies and basis of preparation
	The accounting policies adopted in the preparation of this unaudited balance sheet are consistent with those followed in the Group’s audited annual financial statements for the year ended 31st December, 2000.
2.	Trade and other receivables
	During the period, the Group allows an average credit period of 90 days to its trade customers.
	The following is an aged analysis of trade receivables at the balance sheet date:

	HK$’000
Trade receivables
0 to 30 days	13,540
31 to 60 days	6,036
Over 60 days	-
	19,576
Other receivables	1,206
	20,782

3.	Trade and other payables
	The following is an aged analysis of trade payables at the balance sheet date:

	HK$’000
Trade payables
0 to 30 days	13,005
31 to 60 days	1,059
Over 60 days	-
	14,064
Other payables	7,505
	21,569

4.	Bank borrowings

	HK$’000
Bank borrowings comprise:
Trust receipt loans	2,951
Bank loans	17,094
Bank overdrafts	12
	20,057
All the bank borrowings are repayable within one year.
Bank loans of Renminbi 9 million, equivalent to approximately HK$9.6 million, were secured by the Group’s land and buildings in the PRC.

5.	Reserves

	Share
	premium		Special		Accumulated
	account		reserve		profits
	HK$’000		HK$’000		HK$’000
At 1st January, 2001	37,164		(14,980	)	68,889
Loss attributable
to Shareholders	-		-		(45,399	)
At 30th November, 2001	37,164		(14,980	)	23,490

Further details of the information in relation to, among other things, the unaudited consolidated income statement of the Group for the 11 months ended 30th November, 2001 and the unaudited consolidated balance sheet of the Group as at 30th November, 2001, are set out in the Circular.

By Order of the Board

Ying Wing Holdings Limited

Tsoi Hon Chung

Chairman

Hong Kong, 21st February, 2002

The Directors jointly and severally accept full responsibility for the accuracy of the information contained in this announcement and confirm, having made all reasonable inquiries, that to the best of their knowledge, the opinions expressed in this announcement have been arrived at after due and careful consideration and there are no other facts not contained in this announcement, the omission of which would make any statement in this announcement misleading.

Please also refer to the published version of this announcement in the Hong Kong iMail Post dated 22/2/2002