[For Immediate Release]

Man Sang International

1^st Quarter Records Net Profit of Approximately HK$4.5 Million

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Continues to Consolidate its Core Businesses

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(HONG KONG, August 14, 2001) – Man Sang International Limited (“Man Sang”) (stock code: 938) today announced its first quarter results for the three months ended June 30, 2001.

Following the adjustments made in the past two quarters, business operations are now backing on the right track. In the first quarter, the Group recorded a profit attributable to shareholders of approximately HK$4.5 million. However, due to the continued unfavorable external economic impact, the Group’s turnover for the first quarter decreased by 10.0% to approximately HK$73.3 million as compared to the corresponding period last year. Profit attributable to shareholders also dropped 52.9% as compared to the same period last year.

Though the Group’s performance was not as good as expected, it continues to enjoy a healthy financial position. As at June 30, 2001, cash on hand stood of approximately HK$101.2 million, which has been sufficient to sustain the Group’s daily operations and expenses.

During the period under review, the U.S. economy remained sluggish. After implementing several reductions in interest rates, there was no sign of improvement in the market. Buyers took a highly cautious attitude in placing orders. The unfavorable U.S. economic sentiment has inevitably extended to Europe. The continuing drop in the Euro exchange rate also affected imports.

Cheng Chung Hing, Chairman of Man Sang said, “The continuing down turn of the global economy was somehow out of the management’s expectation. Nevertheless, we need to minimize the impact. With the aim of “tapping new sources and economizing on expenditure", the Group is implementing stringent cost controls internally and adopting flexible marketing strategies. We not only tailor solutions for market of different countries, but also integrate with various value-added services in order to completely fulfill the customers’ needs and requirements.”

Under the review period, there was no significant change to the traditional pearl business. Sales of South Sea pearls were the most positive, accounting for the largest share in the Group’s total turnover of 51.5%. In view of their high quality and a slight increase in supply, the price of South Sea pearls adjusted accordingly, becoming more attractive. In addition, the widespread usage of South Sea pearls in the accessories is being led by the international fashion, making it well sought after in the jewelry market. Capitalizing on this trend, the Group is strengthening its marketing of South Sea pearls to cope with the strong global demand, further enhancing the Group’s market share in the South Sea pearl business.

Both the supply and price of Chinese cultured pearls have stabilized and the Group believes they will soon re-establish the buyers’ confidence. In view of the abundant supplies, it is difficult to predict the market price of Chinese freshwater pearls. This might affect the buyers’ confidence and the management believes Chinese freshwater pearls have to take a longer time to undergo market adjustments. Nevertheless, the quality of both is improving. Once prices stabilize, further surge in demand will boost the market.

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About Man Sang International Limited:

Man Sang was listed on the Hong Kong Stock Exchange in 1997. It is the first pearl company to be listed in Hong Kong. Its principal activities include the purchasing, processing, assembling, merchandising and wholesale distribution of pearls and pearl products, including Chinese cultured pearls, Chinese freshwater pearls, Japanese cultured pearls, Tahitian and South Sea pearls. It operates its own pearl processing facilities in Shenzhen, the PRC.

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