Forte Announces Interim Results 2006

Turnover increased 60.13% to RMB 973.59 million
Net profit attributable to shareholders reached RMB 281.72 million

Financial Highlights

	For the six months ended 30 June		Change (%)
RMB 000 (Unaudited)	2006	2005
Turnover	973,590	607,992	+60.13%
Gross profit	385,375	275,614	+39.82%
Net profit attributable to shareholders	281,718	336,032	-16.16%
Net profit attributable to shareholders (excluding negative goodwill and revaluation gain)	270,798	119,780	+126.08%
Earnings per share - basic (RMB)	0.116	0.146	-20.54%
Proposed interim dividend per share (RMB)	0.05	0.07	-28.57%

8 August 2006 Shanghai Forte Land Co., Ltd. ( Forte or the Group ; HKEx stock code: 2337), one of the largest property developers in Shanghai, announced today its interim results for the six months ended 30 June 2006.
For the six months ended 30 June 2006, the Group s turnover reached RMB973,590,000, representing an increase of 60.13%. The growth in turnover was mainly attributable to the increased number of completed projects during the period under review. Net profit attributable to shareholders reached RMB281,718,000. The decrease in net profit attributable to shareholders was mainly due to negative goodwill realized from the acquisition of two subsidiaries (Beijing Baihong Property Development Limited and Chongqing Runjiang Property Development Company Limited), which amounted to RMB216,252,000, was recognized as income for the corresponding period last year. After deducting negative goodwill and revaluation gain, net profit attributable to shareholders represents a surge of 126.08% over the corresponding period last year. The Board of Directors declared the payment of RMB 0.05 per share as an interim dividend for the six months ended 30 June 2006.
Mr. Fan Wei, Forte s President, commented, During the first half of 2006, the PRC Government continued to implement macro-economic control measures. In order to foster a healthy development of the domestic property market, a number of austerity measures in relation to land supply and financing are enforced. Nevertheless, under the new policy regime, the Group fully embraces the concept of For Better Living and has been committed, from a humanized angle, to providing quality products and services for the growing middle class population, thereby maximizing shareholders values and achieving satisfactory results.
During the period under review, there were 30 projects (including joint venture projects in which the Group has interests in) under development, total gross floor area ( GFA ) amounted to approximately 2,062,659 sq.m., among which, projects located outside Shanghai accounted for approximately 47.55%. 7 projects commenced construction during the period, with a total GFA of approximately 367,394 sq.m. of which projects located outside Shanghai accounted for approximately 44.81%. In addition, 6 projects were completed in the first half of the year, total GFA amounted to approximately 434,973 sq.m..
Including the land bank of joint venture projects that the Group has interests in, as at 30 June 2006, the total GFA of land bank owned by the Group amounted to 5.53 million sq.m.. The Group s current land bank is sufficient for the development need of the next four or five years, thereby laying a solid foundation for its long-term and rapid development.
Looking ahead, Mr. Fan concluded, By leveraging on our current foundation, the Group will expand to one or two more secondary cities and consider acquiring developers with excellent land resources and management team. We will enhance our adaptability towards upcoming macro-economic austerity measures. Regional management will be strengthened by introducing newly trained recruits from our Shanghai Headquarters to guarantee the multi-project management in these regions. The Company will cautiously seek for opportunities to invest in non-residential projects. While expanding our operating scale, we will continue to optimize our rapid asset turnover operations. In the future, the Group will further sublimate its concept of For Better Living by understanding customer needs and providing quality property, which ultimately, maximizing the returns to shareholders.