Starch manufacturer China Essence Group increases revenue 65%

China Essence Group Ltd. (“China Essence” or the “Company”), one of the largest, leading integrated potato-processing producers in the People’s Republic of China (“PRC”), is pleased to announce its full year financial results for the financial year ended 31 March 2008.

Revenue increased 65% over FY2007, from RMB521.2 million to RMB858.8 million, on the back of higher sales volumes. Gross profit grew 52% over FY2007 to reach RMB382.9 million, driven by robust demand for potato starch and higher average selling price (“ASP”).

The Company has declared a final dividend of HK$0.07 per share, which represents a dividend payout of 10.4% based on net profit.

Volume and price of potato starch were key growth drivers for FY2008. Rising procurement orders from new and existing distributors drove volume while ASP grew about 33.8% over FY2007, mirroring the strong domestic demand for potato starch. Underpinning the demand is the anti-dumping regulations on potato starch manufactures from the European Union, which has been in force since February 2007.

Mr Zhao Libin, Chairman and CEO of China Essence said, “We are pleased to deliver a set of outstanding results for FY2008. We have successfully planned and delivered on our expansion plans for FY2008, thus contributing to our good performance for the year.”

“As demand for potato starch, modified starch and potato starch-based products continues to grow,we are pleased to announce fresh plans to strategically expand our operations to meet with this demand. We are also moving towards being a truly integrated potato-processing producer, with our suite of primary, downstream and by products.”