CORPORATE INFORMATION 2 MESSAGE FROM THE CHAIRMAN 3 MANAGING DIRECTOR S STATEMENT 4-5 COMPANY BACKGROUND 6 REPORT OF THE DIRECTORS 7-21

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2 CONTENTS CORPORATE INFORMATION 2 MESSAGE FROM THE CHAIRMAN 3 MANAGING DIRECTOR S STATEMENT 4-5 COMPANY BACKGROUND 6 PAGE(S) REPORT OF THE DIRECTORS 7-21 REPORT OF THE AUDITORS CONSOLIDATED INCOME STATEMENT 24 CONSOLIDATED BALANCE SHEET 25 BALANCE SHEET 26 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 27 CONSOLIDATED CASH FLOW STATEMENT SCHEDULE OF INVESTMENT PROPERTIES 83 GROUP FINANCIAL SUMMARY 84 1

3 CORPORATE INFORMATION DIRECTORS LAM TSANG Suk Yee David LAM Kwing Chan (Chairman) Alvin LAM Kwing Wai (Managing Director) Rosita YUEN LAM Kit Woo Laurent LAM Kwing Chee TSANG Siu Hung CHIU Ming Hung Andrew LAM Ping Cheung Leo CHAN Fai Yue PRINCIPAL BANKER The Hongkong & Shanghai Banking Corporation Limited SOLICITORS Woo Kwan Lee & Lo AUDITORS Deloitte Touche Tohmatsu COMPANY SECRETARY TSANG Siu Hung REGISTERED OFFICE Clarendon House, Church Street Hamilton HM11, Bermuda PRINCIPAL REGISTRARS The Bank of Bermuda Limited 6 Front Street, Hamilton HM11 Bermuda REGISTRARS IN HONG KONG Standard Registrars Limited Ground Floor, Bank of East Asia Harbour View Centre 56 Gloucester Road, Wanchai, Hong Kong HEAD OFFICE AND PRINCIPAL PLACE OF BUSINESS Golden Resources Centre 2-12 Cheung Tat Road Tsing Yi Island, N.T. Hong Kong 2

4 MESSAGE FROM THE CHAIRMAN I would like to express my sincere thanks to all the Directors and staff of the Group for their dedication and contribution during the past year. David LAM Kwing Chan Chairman 3

5 MANAGING DIRECTOR S STATEMENT On behalf of the Board of Directors, I have pleasure in presenting the audited consolidated results of Golden Resources Development International Limited ( the Company ) and its subsidiaries ( the Group ) for the year ended 31st March, BUSINESS REVIEW AND PROSPECTS During the year under review, our rice business in the Mainland China has been performing satisfactorily. The strategic election of the Pearl River Delta region as the platform to penetrate the Mainland China rice market has begun to yield its results as evidenced by the growth in sales. We have focused marketing initiatives on building the brand and business base. Our customer base has been strengthening and expanding. We will continue to deepen the market penetration in order to tap into the major opportunities that lie ahead. We believe that the Mainland China is the heart of growth in the long term and we are confident that the strategic development of the Mainland China market will add tremendous value to the shareholders. In Hong Kong, the rice industry remains in its consolidation process since the liberalization of the rice market at the beginning of the year The Group continues to maintain its market leadership position. To further strengthen our brands and reinforce our market leadership, we have been aggressively focusing efforts on improvements in sales performances, operational efficiency and supply chain management. The Group is confident that our Hong Kong rice business will continue to generate a consistent profit contribution to the Group. The Group is committed to pursuing product excellence. Late last year, the Group obtained the renowned HACCP (Hazard Analysis and Critical Control Points) certification, a complete food safety management system. This serves to recognize our commitment to total customer satisfaction by delivering value-added products with quality service to our customers. The Group continues to maintain strong cash position and prudent financial strategy with ample liquidity. With its cash-rich position and sound balance sheet, the Group is well poised to pursue quality investments when opportunities arise. 4

6 MANAGING DIRECTOR S STATEMENT FINAL DIVIDEND The Directors have resolved to recommend payment of a final dividend of 1.25 cents per share (2003: 1.25 cents per share) for the year ended 31st March, 2004 to shareholders on the Register of Members of the Company on Thursday, 26th August, Together with the interim dividend of 1.25 cents per share paid on Friday, 16th January, 2004, the total dividends for the year will be 2.5 cents per share (2003: 2.75 cents per share). Subject to the approval of shareholders at the forthcoming Annual General Meeting, the dividend warrants will be dispatched to shareholders on or about Thursday, 2nd September, CLOSURE OF REGISTER OF MEMBERS The Register of Members of the Company will be closed from Friday, 20th August, 2004 to Thursday, 26th August, 2004, both days inclusive, during which period no transfer of shares will be effected. In order to qualify for the proposed final dividend, all transfers accompanied by the relevant share certificates must be lodged with the Company's Share Registrars in Hong Kong, Standard Registrars Limited, G/F., Bank of East Asia Harbour View Centre, 56 Gloucester Road, Wanchai, Hong Kong not later than 4:00 p.m. on Thursday, 19th August, PURCHASE, SALE OR REDEMPTION OF LISTED SHARES Neither the Company nor any of its subsidiaries had purchased, sold or redeemed any of the Company's listed shares during the year. On behalf of the Board Alvin LAM Kwing Wai Managing Director Hong Kong, 12th July,

7 COMPANY BACKGROUND Established in 1946, the Golden Resources Group was proud to achieve listing on the Hong Kong Stock Exchange in As an innovative pioneer in the local rice industry, the Group can assert itself as the sole entity to have established a rice mill in Hong Kong, one of the most sophisticated and advanced rice production facilities available. With over 50 years of incessant growth, the Group has claimed a preeminent position, the envy of all in its field. The Group has made its way to the forefront of this industry with a vast spectrum of highly reputable brands including Golden Elephant, Kangaroo and Cherry Blossom, to name but a few. At the inception of this new century, the Group will continue to capitalize on its highly regarded logistics system and distribution network, and endeavor to set the pace in the retail and institutional markets, in offering products and services of uncompromising and unparalleled excellence to diverse markets across the globe. Visit to share the proud heritage of Golden Resources Group. 6

8 REPORT OF THE DIRECTORS The Directors present their annual report and the audited financial statements for the year ended 31st March, PRINCIPAL ACTIVITIES The Company acts as an investment holding company and its subsidiaries are engaged in the business of sourcing, importing, wholesaling, processing, packaging, marketing and distribution of rice, warehouse operations, securities investment, property investment and investment holding. Analyses of the Group's turnover and segment results by business segment and geographical segment are set out in note 5 to the financial statements. SUBSIDIARIES AND ASSOCIATES Details of the Company's principal subsidiaries and of the Group's principal associates at 31st March, 2004 are set out in notes 14 and 15 to the financial statements. RESULTS AND APPROPRIATION The results of the Group for the year ended 31st March, 2004 are set out in the consolidated income statement on page 24. An interim dividend of 1.25 cents per share amounting to approximately HK$16,193,000 was paid to the shareholders during the year. The Directors now recommend the payment of a final dividend of 1.25 cents per share to the shareholders on the Register of Members on Thursday, 26th August, 2004 amounting to approximately HK$16,274,000, and the retention of the remaining profit for the year. SHARE PREMIUM AND RESERVES Movements in share premium and reserves during the year are set out in note 25 to the financial statements. GROUP FINANCIAL SUMMARY A summary of the results and of the assets and liabilities of the Group for the past five financial years is set out on page 84 of the annual report. INVESTMENT PROPERTIES The Group revalued all of its investment properties at 31st March, The revaluation deficit of HK$9,130,000 has been charged to the income statement. 7

9 REPORT OF THE DIRECTORS INVESTMENT PROPERTIES (Continued) Details of movements during the year in the investment properties of the Group are set out in note 13 to the financial statements. PROPERTY, PLANT AND EQUIPMENT Details of movements during the year in the property, plant and equipment of the Group are set out in note 12 to the financial statements. SHARE CAPITAL Details of movements during the year in the share capital of the Company are set out in note 23 to the financial statements. PRE-EMPTIVE RIGHTS There are no provisions for pre-emptive rights under the Company's Bye-Laws or the law of Bermuda, which would oblige the Company to offer new shares on a pro-rata basis to existing shareholders. DIRECTORS The Directors of the Company during the year and up to the date of this report were: Madam LAM TSANG Suk Yee* Mr. David LAM Kwing Chan (Chairman) Mr. Alvin LAM Kwing Wai (Managing Director) Madam Rosita YUEN LAM Kit Woo Mr. Laurent LAM Kwing Chee Mr. TSANG Siu Hung Mr. CHIU Ming Hung# Mr. Andrew LAM Ping Cheung# Mr. Leo CHAN Fai Yue# * Non-executive Director # Independent Non-executive Director In accordance with the Company's Bye-Laws, Madam Rosita YUEN LAM Kit Woo, Messrs. TSANG Siu Hung and CHIU Ming Hung shall retire by rotation and, being eligible, offer themselves for re-election. The term of office of each director, including the independent non-executive directors, is the period up to his retirement by rotation in accordance with the Company's Bye-Laws. 8

10 REPORT OF THE DIRECTORS SERVICE CONTRACTS OF DIRECTORS Messrs. David LAM Kwing Chan and Alvin LAM Kwing Wai have entered into service contracts with the Company for an initial term of three years commencing on 1st January, These service contracts remain effective after the expiry date unless terminated by either party with six months' notice in writing. As at 31st March, 2004, none of these service contracts had been terminated by either party. No Director being proposed for re-election at the forthcoming annual general meeting has a service contract which is not determinable by the Group within one year without payment of compensation (other than statutory compensation). BIOGRAPHICAL DETAILS OF DIRECTORS AND SENIOR MANAGEMENT STAFF 1. Directors The biographical details of the Directors of the Company are as follows: LAM TSANG Suk Yee, aged 90, non-executive Director of the Company. Madam Lam is the co-founder of the Group and the Honorary Chairman of the Company. She graduated from the University of Canton. Madam Lam is the mother of Mr. David LAM Kwing Chan. David LAM Kwing Chan, aged 66, Chairman of the Company. He joined the Group in In 1989, he was made as a Member of the Most Exalted Order of the White Elephant of Thailand by his Majesty, the King of Thailand. In 1993, he was further honoured the Companion (Fourth Class) of the Most Noble Order of the Crown of Thailand. He has extensive experience in rice trading and has been appointed as committee member of the Hong Kong Rice Advisory Committee since April Mr. Lam is the son of Madam LAM TSANG Suk Yee. Alvin LAM Kwing Wai, aged 59, Managing Director of the Company. Mr. Lam joined the Group in 1970 after he obtained his Master of Business Administration degree from the University of California, Berkerly, U.S.A. He has extensive experience in financial management and investment planning. Mr. Lam is the brother of Mr. David LAM Kwing Chan. 9

11 REPORT OF THE DIRECTORS BIOGRAPHICAL DETAILS OF DIRECTORS AND SENIOR MANAGEMENT STAFF (Continued) Rosita YUEN LAM Kit Woo, aged 58, Executive Director and Treasurer of the Company. She graduated from the University of California, Los Angeles, U.S.A. with a B.A. in Economics and joined the Group in Madam Yuen has extensive experience in banking and trading. Madam Yuen is the sister of Mr. David LAM Kwing Chan. Laurent LAM Kwing Chee, aged 57, Executive Director of the Company. He graduated from the Eastern Illinois University, U.S.A. with a bachelor degree in Economics and joined the Group in Mr. Lam has extensive experience in property development and investment. Mr. Lam is the brother of Mr. David LAM Kwing Chan. TSANG Siu Hung, aged 49, Executive Director and Financial Controller of the Company. He holds a bachelor degree in Accountancy and is a fellow member of the Association of Chartered Certified Accountants and the Hong Kong Society of Accountants. He joined the Group in Mr. Tsang has extensive professional experience in finance, accounting and auditing fields. CHIU Ming Hung, aged 55, was appointed as an independent nonexecutive Director of the Company in Mr. Chiu has extensive experience in foodstuff manufacturing business, securities investments and hotel management. He holds directorships in a number of private companies in Taiwan. Andrew LAM Ping Cheung, aged 52, was appointed as an independent non-executive Director of the Company in Mr. Lam is a solicitor and a sole proprietor of Andrew Lam & Co., Solicitors and possesses extensive experience in the field of legal practice. Leo CHAN Fai Yue, aged 63, was appointed as an independent nonexecutive Director of the Company in Mr. Chan has over 20 years of invaluable experience in Hong Kong stock market and manufacturing industry. During his early years in Japan, he was exposed to the trading and finance field. He is a director of a paint manufacturing company in Bangkok. Mr. Chan is a member of The Hong Kong Institution of Directors. 10

12 REPORT OF THE DIRECTORS BIOGRAPHICAL DETAILS OF DIRECTORS AND SENIOR MANAGEMENT STAFF (Continued) 2. Senior Management The five Directors of the Company holding executive offices above are directly responsible for the various businesses of the Group. They are regarded as the members of the senior management of the Group. DIRECTORS' INTERESTS AND SHORT POSITIONS IN SHARES, UNDERLYING SHARES AND CONVERTIBLE BONDS As at 31st March, 2004, the interests and short positions of the directors and their associates in the shares, underlying shares and convertible bonds of the Company and its associated corporations, as recorded in the register maintained by the Company pursuant to Section 352 of the Securities and Futures Ordinance ("SFO"), or as otherwise notified to the Company and The Stock Exchange of Hong Kong Limited (the "Stock Exchange") pursuant to the Model Code for Securities Transactions by Directors of Listed Companies, were as follows: Long positions (a) Ordinary shares of the Company Number of ordinary shares beneficially held in the Company Percentage of the issued Personal Family Total share capital of Name of director interests interests interests the Company Mr. David LAM Kwing Chan 7,935,000 7,935, % Mr. Alvin LAM Kwing Wai 17,500,000 6,000,000 23,500, % (Note 1) 25,435,000 6,000,000 31,435, % 11

13 REPORT OF THE DIRECTORS DIRECTORS' INTERESTS AND SHORT POSITIONS IN SHARES, UNDERLYING SHARES AND CONVERTIBLE BONDS (Continued) (b) Non-voting deferred shares of Golden Resources Development Limited, a 100% owned subsidiary of the Company. Number of non-voting deferred shares Name of director Capacity beneficially held Mr. David LAM Kwing Chan Beneficial owner 260,000 Mr. Alvin LAM Kwing Wai Beneficial owner 260,000 (c) Non-voting deferred shares of Yuen Loong & Company Limited, a 100% owned subsidiary of the Company. Number of non-voting deferred shares Name of director Capacity beneficially held Mr. David LAM Kwing Chan Beneficial owner 13,000 Mr. Alvin LAM Kwing Wai Beneficial owner 13,000 (d) Share options (Note 2) Number of Number of underlying Name of director Capacity options held shares Mr. Alvin LAM Kwing Wai Beneficial owner 25,000,000 25,000,000 Madam Rosita YUEN LAM Beneficial owner 25,000,000 25,000,000 Kit Woo Mr. Laurent LAM Kwing Chee Beneficial owner 25,000,000 25,000,000 Mr. TSANG Siu Hung Beneficial owner 1,250,000 1,250,000 76,250,000 76,250,000 12

14 REPORT OF THE DIRECTORS DIRECTORS' INTERESTS AND SHORT POSITIONS IN SHARES, UNDERLYING SHARES AND CONVERTIBLE BONDS (Continued) Notes: (1) The family interests of 6,000,000 shares represent the interests of the wife of Mr. Alvin LAM Kwing Wai. (2) The details of the personal interest of the directors' underlying shares in respect of share options granted by the Company are stated in the section headed "Share Options" below. Other than as disclosed above, none of the directors nor their associates had any interest or short positions in any shares or underlying shares of the Company or any of its associated corporations. SHARE OPTIONS Particulars of the Company's share option scheme are set out in note 24 to the financial statements. The following table discloses movements in the Company's share options during the year: Outstanding Exercised Lapsed Outstanding Exercise at beginning during during at end Option grant date price of the year the year the year of the year HK$ Directors Mr. Alvin LAM 12th January, ,000,000 9,000,000 Kwing Wai 28th August, ,000,000 16,000,000 Madam Rosita 12th January, ,000,000 15,000,000 YUEN LAM Kit Woo 28th August, ,000,000 10,000,000 Mr. Laurent LAM 12th January, ,000,000 15,000,000 Kwing Chee 28th August, ,000,000 10,000,000 Mr. TSANG Siu Hung 30th January, ,876,000 (626,000) 1,250,000 Total 76,876,000 (626,000) 76,250,000 13

15 REPORT OF THE DIRECTORS SHARE OPTIONS (Continued) Employees Outstanding Exercised Lapsed Outstanding Exercise at beginning during during at end Option grant date price of the year the year the year of the year HK$ 12th January, ,000,000 15,000,000 30th January, ,185,000 (7,280,000) (1,125,000) 5,780,000 28th August, ,000,000 10,000,000 Total 39,185,000 (7,280,000) (1,125,000) 30,780,000 Grand total 116,061,000 (7,906,000) (1,125,000) 107,030,000 The weighted average closing price of the Company's shares immediately before the dates on which the options were exercised was HK$0.37. ARRANGEMENTS TO PURCHASE SHARES OR DEBENTURES Other than as disclosed in the section headed "Share Options" above, at no time during the year was the Company or any of its subsidiaries, a party to any arrangements to enable the Directors of the Company to acquire benefits by means of the acquisition of shares in, or debentures of, the Company or any other body corporate. RELATED PARTY TRANSACTIONS Details of the related party transactions entered into by the Group during the year are set out in note 30 to the financial statements. CONNECTED TRANSACTIONS In the opinion of the directors, there were no transactions which need to be disclosed as connected transactions in accordance with the requirements of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited ("Listing Rules"). 14

16 REPORT OF THE DIRECTORS DIRECTORS' INTERESTS IN CONTRACTS OF SIGNIFICANCE No contracts of significance to which the Company or any of its subsidiaries was a party and in which a Director of the Company had a material interest, whether directly or indirectly, subsisted at the end of the year or at any time during the year. SUBSTANTIAL SHAREHOLDERS As at 31st March, 2004, the register of substantial shareholders maintained by the Company pursuant to Section 336 of the SFO showed that, the Company had been notified of the following substantial shareholders' interest, being 5% or more of the Company's issued share capital: Name of shareholder Number of shares held % Yuen Loong International Limited ("Yuen Loong") 385,052, (Note 1) Chelsey Developments Ltd. ("Chelsey") 236,940, (Note 1) GR Investment International Limited ("GR Investment") 65,957, (Note 2) Notes: (1) Mr. David LAM Kwing Chan, a director of the Company, is interested in approximately 24% of the issued share capital of each of Yuen Loong and Chelsey. Mr. Alvin LAM Kwing Wai, a director of the Company, is a beneficiary of a discretionary trust which is interested in approximately 26% of the issued share capital of each of Yuen Loong and Chelsey. Madam LAM TSANG Suk Yee, a director of the Company, is a beneficiary of a discretionary trust which is interested in approximately 10% of the issued share capital of each of Yuen Loong and Chelsey. Mr. Laurent LAM Kwing Chee, a director of the Company, is a beneficiary of a discretionary trust which is interested in approximately 14% of the issued share capital of each of Yuen Loong and Chelsey. Madam Rosita YUEN LAM Kit Woo, a director of the Company, is a beneficiary of a discretionary trust which is interested in approximately 9% of the issued share capital of each of Yuen Loong and Chelsey. (2) The corporate interests of GR Investment were attributable on account through a number of its wholly-owned subsidiaries. Attentive Investments Limited held 65,957,000 shares of the Company and was a wholly-owned subsidiary of Genius Choice Investments Limited which in turn was a wholly-owned subsidiary of GR Investment Holdings Limited. GR Investment Holdings Limited was a wholly-owned subsidiary of Accufocus Investments Limited which in turn was a wholly-owned subsidiary of GR Investment. Accordingly, Genius Choice Investments Limited, GR Investment Holdings Limited, Accufocus Investments Limited and GR Investment were all deemed to be interested in the 65,957,000 shares of the Company held by Attentive Investments Limited. 15

17 REPORT OF THE DIRECTORS SUBSTANTIAL SHAREHOLDERS (Continued) Other than as disclosed above, the Company has not been notified by any other person who had an interest or short position in the shares or underlying shares of the Company as recorded in the register required to be kept by the Company pursuant to Section 336 of the SFO as at 31st March, CHARITABLE DONATIONS During the year, the Group made charitable donations amounting to approximately HK$585,000. LIQUIDITY AND FINANCIAL RESOURCES The Group has cash balance of HK$98 million as at 31st March, As at 31st March, 2004, the Group had approximately HK$22 million of bank loans, representing a decrease of HK$8 million as compared with the amounts outstanding at 31st March, Details of bank loans of the Group at 31st March, 2004 were as follows: HK$Million Repayable within a period Not exceeding 1 year 20 More than 2 years but not exceeding 5 years 1 More than 5 years 1 22 The bank loans outstanding at 31st March, 2004 were secured. With cash and other current assets of HK$576 million as at 31st March, 2004 as well as available banking facilities, the Group has sufficient financial resources to satisfy its commitments and working capital requirements. NET ASSET VALUE The net asset value of the Group as at 31st March, 2004 was HK$0.7 per share based on 1,300,476,460 shares in issue as at that date. 16

18 REPORT OF THE DIRECTORS EMPLOYEES AND REMUNERATION POLICY The total number of employees for the Group is about 437. Remuneration packages are reviewed by the Group from time to time. In addition to salary payments, other fringe benefits for the staff include retirement benefits schemes and medical insurance scheme, as well as quarters and housing allowances for certain staff. The Group has taken out personal accident insurance for senior staff and the staff who frequently travel overseas on business trips. MAJOR CUSTOMERS AND SUPPLIERS For the financial year ended 31st March, 2004, the five largest customers of the Group accounted for approximately 66% by value of the Group's turnover and the five largest suppliers accounted for approximately 79% by value of the Group's total purchases. Approximately 33% of the Group's turnover and approximately 51% of the Group's total purchases were attributable to the Group's largest customer and supplier respectively. None of the Directors, their associates, or any shareholders (which to the knowledge of the Directors owned more than 5% of the Company's share capital) had a beneficial interest in the Group's five largest customers and five largest suppliers. CODE OF BEST PRACTICE In the opinion of the Directors, the Company has complied with the Code of Best Practice as set out in Appendix 14 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited throughout the financial year ended 31st March, 2004, except that the independent non-executive directors of the Company are not appointed for a specific term but are subject to retirement by rotation and re-election at the annual general meeting of the Company in accordance with the provisions of the Company's Bye-Laws. AUDIT COMMITTEE The Company has an audit committee which was established in accordance with the requirements of the Code of Best Practice, for the purpose of reviewing and supervising the Company's financial reporting process and internal controls. The audit committee comprises the three independent non-executive directors of the Company. 17

19 REPORT OF THE DIRECTORS DISCLOSURES PURSUANT TO RULES AND OF THE LISTING RULES Advance to entities under Rule Loans advanced, and guarantees given for facilities granted, to entities by the Group which individually exceeded 8% of the relevant percentage ratios under Rule of the Listing Rules as at 31st March, 2004 are as follows: Extent of Aggregate of Attributable Non-interest guaranteed advances and interest held bearing Guarantees facilities guarantees Entities by the Group advances (A) given (B) utilised given (A + B) Notes % HK$'000 HK$'000 HK$'000 HK$'000 Sirinumma Company Limited ,644 25,115 8,148 30,759 a Siripattana Rice Company Limited ,988 17,905 26,397 b, c Siripattana Rice Company Limited ,700 10,336 11,700 d, e and Golden Resources Export & (Thailand) Company Limited Sirinumma Company Limited and ,300 14,976 27,300 f Siripattana Rice Company Limited & Aggregate of Sirinumma Company 6,053 90,103 51,365 96,156 g Limited and its subsidiaries Sirinumma Company Limited Dragon Fortune Limited ,213 25,213 h Fortune Leader Overseas Chinese ,539 7,539 7,539 i (Daiyawan) Real Estate Development Company Limited Fortune Leader Overseas Chinese ,475 5,475 5,475 j (Daiyawan) Investment Company Limited Aggregate of Dragon Fortune Limited 25,213 13,014 13,014 38,227 g and its subsidiaries Dragon Fortune Limited 18

20 REPORT OF THE DIRECTORS DISCLOSURES PURSUANT TO RULES AND OF THE LISTING RULES (Continued) Financial assistance to and guarantees given for facilities granted to the Company's Affiliated Companies by the Group under Rule Financial assistance, and guarantees given for facilities granted, to the Company's affiliated companies by the Group which in aggregate exceeded 8% of the relevant percentage ratios under Rule of the Listing Rules as at 31st March, 2004 are as follows: Extent of Aggregate of Attributable Interest Non-interest Total guaranteed advances and interest held bearing bearing advances Guarantees facilities guarantees Affiliated Companies by the Group advances advances (A) given (B) utilised given (A + B) Notes % HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 Aggregate of Sirinumma 6,053 6,053 90,103 51,365 96,156 a - g Company Limited and its subsidiaries Sirinumma Company Limited GR Investment International ,566 6,450 13,016 13,016 k, l Limited Golden World Enterprises ,844 10,844 10,844 m (Wuhan) Limited Openshaw Enterprises Limited ,505 8,505 8,505 n Clever Time Investments ,163 18,163 18,163 o Limited Supreme Development Company ,656 2,656 2,656 p Limited Total 6,566 52,671 59,237 90,103 51, ,340 q 19

21 REPORT OF THE DIRECTORS DISCLOSURES PURSUANT TO RULES AND OF THE LISTING RULES (Continued) The proforma combined balance sheet of the above affiliated companies as at 31st March, 2004 is as follows: HK$'000 Non-current assets 92,937 Current assets 116,152 Current liabilities (88,342) Net current assets 27,810 Non-current liabilities (40,751) Shareholders' funds 79,996 Details of the above affiliated companies are set out in note 15 to the financial statements. Notes: (a) The advances were made pursuant to a loan agreement dated 30th August, 2002 entered into between Cost Logistics Limited, an indirect wholly-owned subsidiary of the Company ("Cost Logistics"), as lender and Sirinumma Company Limited ("Sirinumma") as borrower and they were interest-free, repayable on demand and secured by the shares in Siripattana Rice Company Limited ("Siripattana") that would be allotted and issued to Sirinumma as a result of Sirinumma's additional capital contribution to Siripattana. (b) The advances were current account balances for expenses incurred by Siripattana but paid by the Company for Siripattana and they were interest-free, repayable on demand and unsecured. (c) Siripattana is the Company's associated company and is accounted for using equity accounting method as the entire issued share capital of Siripattana is held as to 51% by Sirinumma (40% of which entire issued capital is indirectly owned by the Company) and as to 49% by Cost Logistics. (d) The guarantee was given for banking facilities granted to Siripattana and Golden Resources Export (Thailand) Company Limited. (e) Golden Resources Export (Thailand) Company Limited is a direct wholly-owned subsidiary of Siripattana. (f) The guarantee was given for banking facilities granted to Sirinumma and Siripattana. (g) Aggregated pursuant to Rule 13.11(2)(c) of the Listing Rules. (h) The advances were made as shareholder's loans to finance the investment made by Dragon Fortune Limited ("Dragon Fortune") and they were interest-free, repayable on demand and unsecured. 20

22 REPORT OF THE DIRECTORS DISCLOSURES PURSUANT TO RULES AND OF THE LISTING RULES (Continued) (i) The entire paid up capital of Fortune Leader Overseas Chinese (Daiyawan) Real Estate Development Company Limited ("FL Real Estate") is owned as to 80% by Fortune Leader Investment Limited ("FL Investment"), a direct wholly-owned subsidiary of Dragon Fortune, and as to 20% by an Independent Third Party. The guarantee was given for loan facilities granted to FL Real Estate. (j) The entire paid up capital of Fortune Leader Overseas Chinese (Daiyawan) Investment Company Limited ("FL Overseas") is owned as to 80% by FL Investment, a direct wholly-owned subsidiary of Dragon Fortune, and as to 20% by an Independent Third Party. The guarantee was given for loan facilities granted to FL Overseas. (k) The interest bearing advances were made as shareholder's loans to finance the investment made by GR Investment International Limited ("GR Investment") and they carried interest at Hong Kong dollar prime rate, were unsecured and with maturity date on 7th March, (l) The non-interest bearing advances were made as shareholder's loans to finance the investment made by GR Investment and they were interest-free, unsecured and had no fixed repayment terms. (m) The advances were made as shareholder's loans to finance the investment made by Golden World Enterprises (Wuhan) Limited and they were interest-free, repayable on demand and unsecured. (n) The advances were made as shareholder's loans to finance the investment made by Openshaw Enterprises Limited and they were interest-free, repayable on demand and unsecured. (o) The advances were made as shareholder's loan to finance the investment made by Clever Time Investments Limited and they were interest-free, repayable on demand and unsecured. (p) The advances were made as shareholder's loans to finance the working capital of Supreme Development Company Limited and they were interest-free, repayable on demand and unsecured. (q) Aggregated pursuant to Rule of the Listing Rules. AUDITORS A resolution will be submitted to the forthcoming Annual General Meeting to re-appoint Messrs. Deloitte Touche Tohmatsu as auditors of the Company. On behalf of the board Alvin LAM Kwing Wai Managing Director Hong Kong, 12th July,

23 REPORT OF THE AUDITORS TO THE MEMBERS OF GOLDEN RESOURCES DEVELOPMENT INTERNATIONAL LIMITED (Incorporated in Bermuda with limited liability) We have audited the financial statements on pages 24 to 82 which have been prepared in accordance with accounting principles generally accepted in Hong Kong. Respective responsibilities of directors and auditors The Company's Directors are responsible for the preparation of financial statements which give a true and fair view. In preparing financial statements which give a true and fair view it is fundamental that appropriate accounting policies are selected and applied consistently. It is our responsibility to form an independent opinion, based on our audit, on those financial statements and to report our opinion solely to you, as a body, in accordance with Section 90 of the Bermuda Companies Act, and for no other purpose. We do not assume responsibility towards or accept liability to any other person for the contents of this report. Basis of opinion We conducted our audit in accordance with Statements of Auditing Standards issued by the Hong Kong Society of Accountants. An audit includes examination, on a test basis, of evidence relevant to the amounts and disclosures in the financial statements. It also includes an assessment of the significant estimates and judgments made by the Directors in the preparation of the financial statements, and of whether the accounting policies are appropriate to the circumstances of the Company and the Group, consistently applied and adequately disclosed. 22

24 REPORT OF THE AUDITORS We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order to provide us with sufficient evidence to give reasonable assurance as to whether the financial statements are free from material misstatement. In forming our opinion we also evaluated the overall adequacy of the presentation of information in the financial statements. We believe that our audit provides a reasonable basis for our opinion. Opinion In our opinion the financial statements give a true and fair view of the state of affairs of the Company and the Group as at 31st March, 2004 and of the profit and cash flows of the Group for the year then ended and have been properly prepared in accordance with the disclosure requirements of the Hong Kong Companies Ordinance. Deloitte Touche Tohmatsu Certified Public Accountants Hong Kong, 12th July,

25 CONSOLIDATED INCOME STATEMENT NOTES HK$'000 HK$'000 (As restated) Turnover 4 800, ,539 Cost of sales (611,303) (479,464) Gross profit 189, ,075 Surplus (deficit) on revaluation of investments in securities 15,931 (7,573) Deficit on revaluation of investment properties (9,130) (2,210) Other operating income 6 13,322 13,774 Selling and distribution costs (36,026) (36,067) Administrative expenses (119,018) (118,725) Impairment loss recognised on investments in securities (6,452) (6,474) Profit from operations 7 47,902 90,800 Finance costs 8 (1,230) (1,120) Share of results of associates 3,327 (28,064) Release of negative goodwill of an associate 15(e) 581 Loss on deemed disposal of an associate (9,465) (1,027) Loss on disposal of a subsidiary (1,135) Profit before taxation 41,115 59,454 Income taxes 9 (9,761) (10,745) Profit after taxation 31,354 48,709 Minority interests 6, Net profit for the year 38,026 49,687 Dividends 10 32,468 35,569 Earnings per share 11 - Basic 2.9 cents 3.8 cents - Diluted 2.9 cents 3.8 cents 24

26 CONSOLIDATED BALANCE SHEET AT 31ST MARCH, 2004 NOTES HK$ 000 HK$ 000 (As restated) Non-current assets Property, plant and equipment , ,939 Investment properties 13 50,030 26,830 Interests in associates , ,220 Investments in securities 16 24,053 66,608 Advances to investee companies 16 51,371 49, , ,758 Current assets Inventories 17 65,958 61,616 Trade debtors 18 46,445 42,085 Other debtors, deposits and prepayments 91,182 55,182 Investments in securities , ,563 Time deposits, bank balances and cash 97, , , ,907 Current liabilities Trade creditors 19 6,866 10,791 Other creditors and accruals 21,696 25,121 Tax liabilities 11,170 13,728 Bank loans - due within one year 20 19,753 27,291 59,485 76,931 Net current assets 516, ,976 Total assets less current liabilities 942, ,734 Non-current liabilities Bank loans - due after one year 20 2,701 3,058 Deferred tax liabilities 21 12,006 12,061 Advances from minority shareholders 22 12,202 13,765 26,909 28,884 Minority interests 8,418 16, , ,075 Capital and reserves Share capital , ,257 Reserves , , , ,075 The financial statements on pages 24 to 82 were approved and authorised for issue by the Board of Directors on 12th July, 2004 and are signed on its behalf by: Alvin LAM Kwing Wai Managing Director TSANG Siu Hung Executive Director 25

27 BALANCE SHEET AT 31ST MARCH, 2004 NOTES HK$'000 HK$'000 Non-current asset Interests in subsidiaries , ,472 Current assets Debtors, deposits and prepayments Bank balances and cash , ,627 Capital and reserves Share capital , ,257 Reserves , , , ,627 Alvin LAM Kwing Wai Managing Director TSANG Siu Hung Executive Director 26

28 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY Total equity HK$'000 At 1st April, as originally stated 894,768 - prior period adjustments (Note 2) (9,564) - as restated 885,204 Exchange adjustments less minority interests not recognised in the income statement 870 Share of exchange adjustments of associates 777 Exchange reserve eliminated on disposal of a subsidiary (150) Goodwill reserve eliminated on deemed disposal of an associate 3,882 Issue of new shares - share capital share premium 658 Net profit for the year, as restated 49,687 Prior year final dividend paid (25,839) Adjustment of final dividend for the year ended 31st March, 2002 (12) Interim dividend paid (19,389) At 31st March, 2003, as restated 896,075 Exchange adjustments less minority interests not recognised in the income statement 1 Share of exchange adjustments of associates 1,319 Effect of change in tax rate on land and buildings revaluation reserve (862) Exchange reserve eliminated on disposal of a subsidiary (80) Goodwill reserve eliminated on disposal of a subsidiary 20 Goodwill reserve eliminated on deemed disposal of an associate 3,102 Issue of new shares - share capital share premium 1,344 Net profit for the year 38,026 Prior year final dividend paid (16,168) Adjustment of final dividend for the year ended 31st March, 2003 (1) Interim dividend paid (16,193) At 31st March, ,374 27

29 CONSOLIDATED CASH FLOW STATEMENT HK$'000 HK$'000 OPERATING ACTIVITIES Profit before taxation 41,115 59,454 Adjustments for: Impairment loss recognised on investments in securities 6,452 6,474 Interest income (9,844) (8,644) Finance costs 1,230 1,120 Dividend income from investments in securities (955) (733) Depreciation and amortisation of property, plant and equipment 13,127 13,248 (Gain) loss on disposal of property, plant and equipment (5) 368 Share of results of associates (3,327) 28,064 Release of negative goodwill of an associate (581) Deficit on revaluation of investment properties 9,130 2,210 Bad debts written off 1, Amortisation of goodwill 1,834 (Gain) loss on disposal of subsidiaries (50) 1,135 Loss on deemed disposal of an associate 9,465 1,027 Operating cash flows before movements in working capital 67, ,421 Increase in other investments (70,389) (86,180) Increase in inventories (4,342) (11,463) (Increase) decrease in trade debtors (4,506) 20,265 (Increase) decrease in other debtors, deposits and prepayments (39,409) 20,825 Decrease in trade creditors (3,925) (18,586) Decrease in other creditors and accruals (3,350) (9,093) Effect of foreign exchange rate changes (345) 733 Cash (used in) generated from operations (59,062) 22,922 Hong Kong Profits Tax paid (13,040) (24,657) Hong Kong Profits Tax refunded 3 64 Income tax in other jurisdiction paid (275) (67) NET CASH USED IN OPERATING ACTIVITIES (72,374) (1,738) 28

30 CONSOLIDATED CASH FLOW STATEMENT NOTES HK$'000 HK$'000 INVESTING ACTIVITIES Interest received 11,934 9,534 Dividend received from investments in securities Advances to associates (1,280) (31,000) Acquisition of a subsidiary 28 (17,099) (15,000) Addition to investment in an associate (10,383) (5,092) Disposal of subsidiaries 29 4,961 Purchases of property, plant and equipment (8,757) (7,206) Advances to investee companies (4,260) (8,558) Purchase of investment securities (2,961) (5) Repayments from investee companies 2,050 8,622 Repayments from associates 46,682 3,590 Proceeds from disposal of property, plant and equipment NET CASH GENERATED FROM (USED IN) INVESTING ACTIVITIES 17,302 (39,417) FINANCING ACTIVITIES Dividends paid (32,362) (45,240) Interest paid (1,305) (1,167) New bank loans raised 9,434 Proceeds from issue of new shares 2,135 1,045 Advances from minority shareholders 20 Repayments of bank loans (17,329) (5,672) Repayments of other loans (5,066) Repayments of advances from minority shareholders (3,239) (435) NET CASH USED IN FINANCING ACTIVITIES (42,666) (56,515) NET DECREASE IN CASH AND CASH EQUIVALENTS (97,738) (97,670) CASH AND CASH EQUIVALENTS AT BEGINNING OF THE YEAR 195, ,131 CASH AND CASH EQUIVALENTS AT END OF THE YEAR 97, ,461 ANALYSIS OF THE BALANCES OF CASH AND CASH EQUIVALENTS Time deposits, bank balances and cash 97, ,461 29

31 1. GENERAL The Company is incorporated in Bermuda as an exempted company with limited liability and its shares are listed on The Stock Exchange of Hong Kong Limited (the "Stock Exchange"). The Company acts as an investment holding company and its subsidiaries are engaged in the business of sourcing, importing, wholesaling, processing, packaging, marketing and distribution of rice, warehouse operations, securities investment, property investment and investment holding. 2. ADOPTION OF HONG KONG FINANCIAL REPORTING STANDARDS In the current year, the Group has adopted, for the first time, the following Hong Kong Financial Reporting Standards (HKFRSs) issued by the Hong Kong Society of Accountants (HKSA), the term of HKFRS is inclusive of Statements of Standard Accounting Practice (SSAPs) and Interpretations approved by the HKSA: SSAP 12 (Revised) Income taxes Income taxes In the current year, the Group has adopted SSAP 12 (Revised) "Income Taxes". The principal effect of the implementation of SSAP 12 (Revised) is in relation to deferred tax. In previous years, partial provision was made for deferred tax using the income statement liability method, i.e. a liability was recognised in respect of timing differences arising, except where those timing differences were not expected to reverse in the foreseeable future. SSAP 12 (Revised) requires the adoption of a balance sheet liability method, whereby deferred tax is recognised in respect of all temporary differences between the carrying amount of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, with limited exceptions. In the absence of any specific transitional requirements in SSAP 12 (Revised), the new accounting policy has been applied retrospectively. Comparative amounts for 2003 have been restated accordingly. 30

32 2. ADOPTION OF HONG KONG FINANCIAL REPORTING STANDARDS (Continued) As a result of this change in policy, the balance of retained earnings at 1st April, 2002 has been increased by HK$3,498,000, representing the cumulative effect of the change in policy on the results for periods prior to 1st April, The balance on the Group's land and buildings revaluation reserve at 1st April, 2002 has been decreased by HK$13,062,000, representing the deferred tax liability recognised in respect of the revaluation surplus on the Group's land and buildings at that date. The change has resulted in an increase in the profit of HK$408,000 for the year ended 31st March, 2004 (2003: HK$373,000). 3. SIGNIFICANT ACCOUNTING POLICIES The financial statements have been prepared under the historical cost convention, as modified for the revaluation of investment properties and investments in securities. The financial statements have been prepared in accordance with accounting principles generally accepted in Hong Kong. The principal accounting policies adopted are as follows: Basis of consolidation The consolidated financial statements incorporate the financial statements of the Company and its subsidiaries made up to 31st March each year. The results of subsidiaries acquired or disposed of during the year are included in the consolidated income statement from the effective date of acquisition or up to the effective date of disposal, as appropriate. Goodwill Goodwill arising on consolidation represents the excess of the cost of acquisition over the Group's interest in the fair value of the identifiable assets and liabilities of a subsidiary or associate at the date of acquisition. 31

33 3. SIGNIFICANT ACCOUNTING POLICIES (Continued) Goodwill (Continued) Goodwill arising on acquisitions prior to 1st April, 2001 continues to be held in reserves, and will be charged to the income statement at the time of disposal of the relevant subsidiary or associate, or at such time as the goodwill is determined to be impaired. Goodwill arising on acquisitions after 1st April, 2001 is capitalised and amortised on a straight-line basis over its estimated useful economic life. Goodwill arising on the acquisition of an associate is included within the carrying amount of the associate. Goodwill arising on the acquisition of subsidiaries is presented separately in the balance sheet. On disposal of a subsidiary or associate, the attributable amount of unamortised goodwill or goodwill previously eliminated against or credited to reserves is included in the determination of the profit or loss on disposal. Negative goodwill Negative goodwill arising on consolidation represents the excess of the Group's interest in the fair value of the identifiable assets and liabilities of a subsidiary or associate at the date of acquisition over the cost of acquisition. Negative goodwill arising on acquisitions prior to 1st April, 2001 continues to be held in reserves, and will be credited to income at the time of disposal of the relevant subsidiary or associate. Negative goodwill arising on acquisitions after 1st April, 2001 is presented as a deduction from assets. To the extent that such negative goodwill is attributable to losses or expenses anticipated at the date of acquisition, it is released to income in the period in which those losses or expenses arise. The remaining negative goodwill is recognised as income on a straight-line basis over the remaining average useful life of the identifiable acquired depreciable assets. To the extent that such negative goodwill exceeds the aggregate fair value of the acquired identifiable non-monetary assets, it is recognised in income immediately. 32

34 3. SIGNIFICANT ACCOUNTING POLICIES (Continued) Negative goodwill (Continued) Negative goodwill arising on the acquisition of an associate is deducted from the carrying value of that associate. Negative goodwill arising on the acquisition of subsidiaries is presented separately in the balance sheet as a deduction from assets. Revenue recognition (i) Sales of goods and warehousing income Sales of goods are recognised as revenue when goods are delivered and title has passed. Warehousing income is recognised when services are rendered. (ii) Rental income Rental income under operating leases is recognised on a straight- line basis over the relevant lease terms. (iii) Sales of investments in securities Revenue arising on the sale of investments in securities is recognised on a trade-date basis. (iv) Dividend income Dividend income from investments is recognised when the Group's rights to receive payment have been established. (v) Interest income Interest income is accrued on a time basis, by reference to the principal outstanding and at the interest rate applicable. Investments in subsidiaries Investments in subsidiaries are included in the Company's balance sheet at cost less any identified impairment loss. 33

35 3. SIGNIFICANT ACCOUNTING POLICIES (Continued) Interests in associates The consolidated income statement includes the Group's share of the post-acquisition results of its associates for the year. In the consolidated balance sheet, interests in associates are stated at the Group's share of the net assets of the associates, plus the goodwill or less the negative goodwill in so far as it has not already been written off/amortised/released to income, less any identified impairment loss. Borrowing costs Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, are capitalised as part of the cost of those assets. Capitalisation of such borrowing costs ceases when the assets are substantially ready for their intended use or sale. All other borrowing costs are recognised as an expense in the period in which they are incurred. Property, plant and equipment Property, plant and equipment are stated at cost or valuation less depreciation and amortisation and accumulated impairment loss. Certain of the Group's leasehold land and buildings are stated at their revalued amounts at 1990, less subsequent accumulated depreciation and amortisation and any subsequent impairment losses. Advantage has been taken of the transitional relief provided by paragraph 80 of SSAP No. 17 "Property, Plant and Equipment" issued by the Hong Kong Society of Accountants from the requirement to make regular revaluations of the Group's leasehold land and buildings which had been carried at revalued amounts prior to 30th September 1995, and accordingly no further revaluation of leasehold land and buildings is carried out. In previous years, the surplus arising on revaluation of these properties was credited to the land and buildings revaluation reserve. Any future decrease in value of these assets will be dealt with as an expense to the extent that they exceed the balance, if any, 34