Skyworth Group Limited — Earnings Release 2010

Oct 27, 2009

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

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SKYWORTH DIGITAL HOLDINGS LIMITED

( 創 維 數 碼 控 股 有 限 公 司 ) （於百慕達註冊成立之有限公司） (Stock Code: 00751)*

ANNOUNCEMENT TV SALE VOLUME IN SEPTEMBER 2009 AND IN THE FIRST HALF OF THE FINANCIAL YEAR 2009/10, TV MARKET SHARES IN MAINLAND CHINA AND ESTIMATED SUBSTANTIAL INCREASE IN THE GROUP’S PROFIT

The China TV business unit of the Group achieved remarkable growth of 216% and 238% in its sales volume of flat panel TV (mostly LCD TV) in September 2009 and from April to September 2009, respectively, compared with that in the corresponding periods of last year. In term of total sales volume, it recorded 19% growth in September 2009 and an increase of 10% in April to September 2009, compared with that in the corresponding periods of last year.

The China TV business unit achieved significant revenue growth of 69% and 49% in September 2009 and from April to September 2009, respectively, compared with that in the corresponding periods of last year.

For the 12 months ended 30 September 2009, the Group ranked at number 1 and 2 in volume and revenue market shares, respectively, in mainland China LCD TV market.

The overseas TV business unit of the Group recorded a slight 1% decrease in its sales volume but significant 19% growth in revenue in September 2009.

The overall TV sales revenue of the Group achieved an encouraging growth of 64% and 36% in September 2009 and from April to September 2009, respectively, compared with that in the corresponding periods of last year.

In view of the remarkable growth of the unaudited sales revenue of the China TV business unit as described above, the Company expects that the unaudited consolidated profit of the Group for the first 6 months of this financial year ended 30 September 2009 are most likely to be substantially higher than the unaudited consolidated profit of the Group amounted to HK$115 million for the same period in last financial year.

Please note that all data in this annoucement are unaudited and therefore may differ from the audited data.

The board of directors (the “Board”) of Skyworth Digital Holdings Limited (the “Company”, together with its subsidiaries, the “Group”) is pleased to present the following unaudited figures relating to the Group’s sale of television sets (“TV”):

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		September 2009 September 2008 September 2009 vs. September 2008	September 2009 September 2008 September 2009 vs. September 2008	April to September 2009 April to September 2008 April to September 2009 vs. April to September 2008	April to September 2009 April to September 2008 April to September 2009 vs. April to September 2008
		Unit (‘000) Unit (‘000) Increase/ (Decrease)		Unit (‘000) Unit (‘000) Increase/ (Decrease)
	TV sales volume
	China TV business unit(Note 1) whichcomprises:	850 712 19%		3,238 2,955 10%
	- Flat Panel TV_(Note 2)_	736.2 233.2	216%	2,584.6 764.9	238%
	- HDTV-CRT_(Note 2)_	27.2 144.2	(81%)	140.9 625.3	(77%)
	- TraditionalCRT TV_(Note 2)_	86.6 334.3	(74%)	512.0 1,564.4	(67%)
	Overseas TV business unit(Note 3) whichcomprises:	349 353 (1%)		950 2,033 (53%)
	- Flat Panel TV	88.1 10.2	764%	158.5 118.0	34%
	- TraditionalCRT TV	261.6 342.5	(24%)	791.5 1,914.7	(59%)
	Total TV sales volume	1,199 1,065 13%		4,188 4,988 (16%)
	TV sales revenue
	China TV business unit(Note 1)	69%		49%
	Overseas TV business unit(Note 3)	19%		(38%)
	Total TV sales revenue	64%		36%

• Note 1: The TV sales volume or revenue of the China TV business unit relates to sale of TV, all under brand, entirely in mainland China market.

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• Note 2: Flat Panel TV refers to TV with liquid crystal display (“LCD TV”) and plasma panels; HDTV-CRT refers to high definition TV with cathode ray tubes (“CRT”); and Traditional CRT TV refers to traditional TV with CRT.

• Note 3: The great majority of TV manufactured by the overseas TV business unit is manufactured for foreign TV brands owned by third parties for sale in overseas and mainland China markets. The business unit also designs, manufactures and sells TV under brand in Hong Kong, Macau and overseas markets, the volume and amount of which are currently insignificant. Furthermore, the sales volume or revenue of the overseas TV business unit includes that relating to TV sold in complete-knocked down and semi-knocked down forms.

CHINA TV BUSINESS UNIT

Impressive Sales Volume Growth of LCD TV

The China TV business unit of the Group achieved remarkable growth of 216% and 238% in its sales volume of flat panel TV (mostly LCD TV) in September 2009 and from April to September 2009, respectively, as compared with that in the corresponding periods of last year.

The National Day holidays in October made September one of the peak months for TV manufacturers in the mainland China. Comparing with the sales volume of TV for September 2008, the China TV business unit recorded significant 19% and 10% growth in its total sales volume for September 2009 and from April to September 2009, respectively.

Significant TV Revenue Growth

The sales volume of flat panel TV from April to September 2009 represented 87% of the total China TV sales volume of the Group compared to 33% in the same period last year. The China TV business unit achieved 69% and 49% significant growth in revenue in September 2009 and from April to September 2009, respectively, compared with the revenue in the corresponding periods of last year.

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Leading Market Shares

According to the TV market survey covering 312 cities and 3,308 retail terminals in mainland China performed by All View Consulting Co., Ltd. (“AVC”), a market survey subsidiary of China Video Industry Association, the Group’s market shares among local and foreign TV brands in mainland China for the 12 months ended 30 September 2009 are as follows:

	Ranking	Market share
All TV
- Volume	1	15.5%
- Revenue	1	12.7%
LCD TV
- Volume	1	15.9%
- Revenue	2	13.2%

OVERSEAS TV BUISNESS UNIT

TV Sales Volume

The overseas TV business unit of the Group has improved its financial performance and is on the track of shifting its product mix from CRT TV towards LCD TV in September 2009. Drastic growth of 764% in sales volume of LCD TV was achieved in September 2009. The overseas TV business unit recorded a slight decrease of 1% in its TV sales volume in September 2009 when compared with that in September 2008. The aggregate TV sales volume of the business unit from April to September 2009 decreased by 53%, compared with that in the first half of last financial year.

TV Sales Revenue

The sales revenue of the overseas TV business unit increased by 19% in September 2009 and narrowed to a decrease of 38% from April to September 2009, compared with that in the corresponding periods last year.

OVERALL TV SALES VOLUME & REVENUE

The total TV sales volume of the Group increased by 13% in September 2009, compared with that in the same month last year. Due to the significant decrease of the overseas TV sales volume, the accumulated total TV sales volume of the Group from April to September 2009 decreased by 16%, compared with that in the same period last year.

The overall TV sales revenue of the Group achieved an encouraging growth of 64% and 36% in September 2009 and from April to September 2009, respectively, compared with that in the corresponding periods last year.

ESTIMATED SUBSTANTIAL INCREASE IN THE GROUP’S PROFIT

In view of the remarkable growth of the unaudited sales revenue of the China TV business unit as described above, the Company expects that the unaudited consolidated profit of the Group for the first 6 months of this financial year ended 30 September 2009 are likely to be substantially better than the unaudited consolidated profit of the Group amounted to HK$115 million for the same period in last year. Further details will be disclosed in separate announcement when the

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unaudited consolidated management financial statements of the Group for the six months ended 30 September 2009 are available.

Please note that all data above are unaudited and therefore may differ from the audited data.

For and on behalf of the Board Skyworth Digital Holdings Limited Leung Chi Ching, Frederick Executive Director

Hong Kong, 27 October 2009

As at the date of this announcement, the Board comprises Mr. Zhang Xuebin as executive chairman of the Board, Ms. Ding Kai, Mr. Yang Dongwen, Ms. Lin Wei Ping and Mr. Leung Chi Ching, Frederick as executive Directors, and Mr. So Hon Cheung, Stephen, Mr. Li Weibin and Mr. Xie Zhengcai as independent non-executive Directors.

• For identification purpose only

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