SUNWAY (58.HK / S34.SG) Reports Marked Revival of Performance in 2002

Hong Kong, January 23, 2003 - Leading electronic consumables and components producer Sunway International Holdings Limited (SEHK: 58/SES: S34) today announces that for the year to September 2002, the Group recorded a consolidated turnover of HK$693,260,000, up 4.8% from a year ago. Successful launch of new products and continuous improvement in the operating environment contributed to a strong revival of the Group's performance over the previous year, and helped maintain overall gross margin at a comfortable level of 13.6%, despite mounting pressure to cut prices as a result of fierce competition. Net profit for the period amounted to HK$30,219,000, representing a significant rebound from HK$5,453,000 a year ago. The Group declared a final dividend of HK1.0 cent per ordinary share.

Ms Helen Wong King-ching, Chairman, Sunway International noted: "Sunway has been successful in sustaining its status as the world's largest manufacturer of calculators. Our next task is to increase shareholders' value through product mix enhancement, innovation and efficiency improvement. These measures are crucial to propel Sunway's conquest of new frontiers and continual corporate development. As a dominant player in the industry, we look forward to furthering our lead through continuous product and technology advancement."

In the year, sales of electronic calculators under the Group's proprietary "Sunway", "Kenko" and "Gavao" labels, and electronic watches and clocks advanced 26.7% and 18.7% respectively following successful introduction of new products including Euro-conversion calculators, scientific and double-line display calculators and as a result of cost efficiency stemming from economies of scale. The two business categories contributed 63.3% and 5.0% respectively of Group revenues. This stable revenue stream has provided room for the Group to develop other electronics-backed devices including television game consoles, digital timepieces, electronic dictionaries and organizers, calculators with currency conversion functions that command higher prices and margins.

Sales of quartz crystals and liquid crystal displays (LCD) accounted for 7.9% and 6.5% of the Group's turnover respectively. The Group remained to be one of the largest manufacturers of quartz crystals and LCD in China.

A new STN-LCD line was installed during the period, enabling production of larger 14" x 16" LCD panels in addition to the existing 7" x 8" panels. The larger panels can be segregated into sizes which are applicable on such higher-priced products as electronic dictionaries and caller identity display panels. This new line is undergoing pilot production tests and will soon contribute to the Group's turnover. To further the Group's product upward penetration, it is exploring the feasibility of producing LCD modules (LCM).

The production volume of high-frequency quartz crystal display was yet to reach a level that reaps most benefit from economies of scale. In order to optimize production scale, the Group targets to boost its capacity in the coming year through active improvement in marketing and management.

"Sunway always gives considerable weight to product research and development, which had supported positive growth in our turnover and sustainable gross margin against the background of severe price reduction pressure. Our resources endeavored to R&D have always been above the industry average. We have been blending in the industry's best technical, design and costing capabilities to maintain a product mix that strikes optimal balance between margin and volume," continued Ms Wong.

Sunway plans to further strengthen its R&D teams stationed in Hong Kong and Fujian, which are supported by a design house specializing in product outlook creations.

Already possessing a dominant position in major cities in China, Sunway plans to extend its reach to the northwest part of the country, including Chengdu. The Group will also strive to boost overseas sales by establishing a new export department in its production base in Fujian. Last year the Group saw pick up in demand from Europe, the Middle East, South Africa, India, Indonesia and markets alike.

To effect better management control over the expanding scope of businesses, Sunway has re-aligned its operations under distinctive business entities. The restructuring will also bring tax benefits to the Group in the next few years.

Ms Wong concluded: "Sunway has been enjoying a leading position in the consumer electronics industry for years, winning over its closest peer by a comfortable margin. We believe only through discipline, diligence and dedication can we maintain this position and survive in this extremely competitive environment. We will continue to maintain a close scrutiny in the key areas of management including inventory, delivery logistics, defective rate control, research and development, and production management."

Finance costs rose by 35.3% to HK$17,326,000 due to interest paid for convertible bonds redeemed during the period. The Group has fully repaid this convertible bond issue and will cease to incur any interest and repayment liabilities in the coming year. As at September 30, the Group had cash in hand of HK$135,057,000.

About Sunway International Holdings

Sunway International Holdings Limited (HKSE: 58 / SES: S34) is a leading China-based manufacturer of consumer electronic products and components with a wide stretch of businesses from calculators, quartz crystals, liquid crystal displays (LCD), integrated circuits to electronic watch movements. It is one the world's largest manufacturers of calculators and also participates in the thriving telecoms equipment manufacturing sector through a 40% interest in a joint venture with Taiwan Telecommunication Investment Co. Ltd. The Group's manufacturing facilities are based in Fujian, China with a workforce of 15,000 under the Group.