2 002 I NTERIM R ESULTS

1. 2002 INTERIM RESULTS

2. Highlights HK$ YoY Growth (million)(%) • Turnover 1,720 +6.4 • Net Profit 485 -29.7 /-17.8 # • Gross Profit 913 +10.3 • EBITDA 720 -10.4 • Interim dividend HK15 cents +7.1 # After discounting exceptional gain from Shanghai Jahwa spin-off listing in 2001

3. Reasons for profit decline • No exceptional gain in 1H2002 • Reduction of interest income • Slippage of Huizhong autoparts business • Share of attributable loss of SMIC due to depreciation and interest expenses

4. Financial Position HK$ (billion) • Cash on hand 3.26 • Total borrowing 1.64 • Net cash 1.62 • Gearing ratio 10.9 % • Interest cover 17 times

5. SECTOR REVIEW

6. Infrastructure/Logistics Infrastructure facilities • Contributed HK$354M • Stable cash income from main arteries of Shanghai’s expressway network • Waigaoqiao Container Terminal Phase I received government approval; finalizing details regarding operation, capital contribution procedures and work schedules

7. Infrastructure/Logistics Modern Logistics • Acquired control stakes in EAS international with 1100-city distributions network in China • Acquired controlling interests in CTII Worldwide Ltd.in Hong Kong (re-named EAS Worldwide Logistics) • Established management operation platform covering Beijing, Shanghai and Hong Kong

8. Infrastructure/Logistics Modern Logistics • Shanghai Wai Lian Fa (at Waigaoqiao Free Trade Zone) • Actively expanding market share, secured a 80-company customer base, and 33,000-tonne warehouse delivery • Shanghai Sinotrans (at Chemical Industrial Zone) • Obtained business license and started operation in July 2002

9. Infrastructure/Logistics Modern Logistics • Actively consolidate nationwide modern logistics business with newly acquired resources • Introduce international strategic partners to maximize exposure to fast-growing logistics demand in China

10. Information Technology SMIC • Production capacity exceeded 10K wafers/m, to reach 30K wafers/m by year-end • Received 0.18-micron CMOS process certification; first foundry in China to produce 0.18-micron logic technology in volume • Secured technology partners including Toshiba, Fujitsu, Chartered • Formed partnership with IMEC in advanced semiconductor process technology • Expected to achieve break-even in Q4/2002

11. Information Technology SII • Contributed RMB21.29M net profit, up 43% • Completed 40K cable TV subscribers upgrade, to reach 1.6M total by year-end • “Cableplus” broadband service secured 40K commercial subscribers • Shanghai Information Pipeline completed > 600 km of Shanghai government system service network; 1H2002 sales contract totalled RMB80M IT sector posted HK$28.5M loss due to attributable loss of SMIC

12. Medicine and Bio-technology SIIC MedTech + Sunway Biotech, Mergen Ltd, Sunve Pharmaceutical SIIC MedTech • Contributed HK$29.3M net profit, up 5.3%* • Hangzhou Qingchunbao : • Qingchunbao Anti-aging Tablets sales up 70.4%, Shen Mai, Dan Shen, Huang Qi and Herba Houttuyniae injection medicines sales up 6.9%, 16.5%, 26.6%, 34.4% respectively * Ex-exceptional in 2001

13. Medicine and Bio-technology SIIC MedTech • Shanghai Jahwa: • Liushen and Herborist products sales up 13% and 50% respectively; Herborist specialty stores expanding to Xian, Qingdao, Nanjing, Shenzhen, also entered Watson’s chain stores in Hong Kong

14. Medicine and Bio-technology Sunway Biotech: • H101 anti-cancer medicine completed Phase 2 clinical trial, to commence Phase 3 in Sept; also launched H103 pre-clinical studies in U.S. and China simultaneously • Recorded net loss of RMB15.8M Sunve Pharmaceutical: • Self-developed new products received Shanghai Municipal New Product Award; Raw materials medicine passed FDA certification and entered U.S. Market • Recorded net profit of RMB4.75M Mergen: • Secured contract with CuraGen to provide microarrays supply, custom array design services; granted 2 patents for new DNA chips technology

15. Consumer Products/Retailing Aggressive growth in 1H2002 Net Profit YoY Growth HK$M (%) • Nanyang Tobacco 46.78 +18.3 • Wing Fat Printing 43.00 +16.0 • Bright Dairy 89.25 +40.0 • Orient Shopping Centre 17.01 +23.0

16. Consumer Products/Retailing Nanyang Tobacco • Maintained stable domestic sales in Hong Kong • Strengthened market share in Singapore • Entered Taiwan market • Sale of duty-free cigarettes up 103% Wing Fat Printing • Developed new tobacco packs for Nanyang • Increased tobacco packs production for European Tobacco Inc.

17. Consumer Products/Retailing Bright Dairy • Bottled milk sales up 322% • New production facilities in Guangzhou and Beijing to start in 2H2002 • Listed at Shanghai Stock Exchange on August 28, over-subscribed by 584 times • To contribute HK$220M exceptional gain in 2H2002 Orient Shopping Centre • Organised mega sale events in store that helped boost sales

18. Autoparts Shanghai Huizhong • Contributed RMB33.4M net profit, down 61% • Substantial price-cut of domestic-made sedans led to profit decline • Car sale expected to resume growth in 2H2002 Shanghai Wanzhong • Upgrading heavy truck production facilities to consolidate market share SIIC Transportation Electric • Contributed RMB11.38M net profit, up 56% • Focused on developing high value-added and high-tech auto parts • Enrolled 146 national dealers

19. Outlook • Continue to focus on developing infrastructure, modern logistics, information technology and medicine and bio-technology businesses • Continue to leverage on sustained growth of Shanghai’s economy by investing in key development projects • Plan to divest non-core businesses by spin-off, internal re-organization or transfer • Poised to benefit from newly developed businesses such as semiconductor and modern logistics • Adopting stringent controls on operating costs and risks • Further improve corporate management to raise corporate governance standards