Major Shareholder:

• Mr. Ng Hung Sang, Robert ¡V 66.3% interest

Company Subsidiary:

• Jessica Girl Limited (100%): Proposed to be publication of Jessica Girl Magazine
• Jessica Limited (100%): Publication of Jessica Magazine
• Superb Taste Company Limited (10%): Publication of Lisa Magazine
• Jessica Management Limited (100%): Employees Management

The principal business activity of the Group is the publication of monthly Chinese language magazines for female readers, namely "Jessica" magazine and "Lisa" magazine. The magazines of the Group are principally marketed in Hong Kong while "Jessica" magazine is also made available in Taiwan through an independent distributor. No separate disclosure is made in this prospectus for the circulation figures of Taiwan, as the circulation figures of Taiwan are insignificant.

Each magazine of the Group has its own target reader market and different contents. "Jessica" magazine mainly targets female executives aged between 25 and 35 and covers topics about fashion, beauty, money management, career advancement, lifestyle, healthy living, relationships and sex. "Lisa" magazine mainly targets modern female readers aged between 25 and 45 who enjoy family life and it provides information on cooking, dining, healthy living and home living issues.

"Jessica" magazine is principally tailored for and targets female executives. It provides information on fashion, beauty, money management and career advancement, lifestyle, healthy living, relationships and sex.

"Lisa" magazine is a magazine, which targets modern female readers who enjoy family life. It comprises two booklets, one being the principal "Lisa" booklet focusing on home living ideas and tips and the other booklet titled "Book recipes" focusing on cooking ideas and recipes. This magazine provides information on nutritious recipes, restaurant profiles, and health tips, fashion and beauty ideas, childcare and development and home decoration.

Generally, the main sources of revenue for magazines are advertising income and circulation income. According to the Hong Kong ACNielsen on Advertising Expenditure Report, advertising expenditures on television, radio, newspapers, magazines, cinema and Mass Transit Railway, airport and others have increased by about 13.7% from 1998 to 1999 and about 16.4% from 1999 to 2000.

According to the same report, advertising expenditures for magazines have increased by approximately 27.5% from 1998 to 1999 and approximately 33.5% from 1999 to 2000. The same statistics also show that advertising expenditures on magazines as a percentage of the total advertising expenditure have increased from approximately 10.4% in 1998 to approximately 13.4% in 2000. All these figures show the positive market demand for magazine advertising in Hong Kong.

The Directors believe that the Group has the following competitive advantages:

• the well-established publishing title of "Lisa" magazine;
• its broad client base of advertisers comprising advertising agencies and renowned direct clients;
• its experienced management team which possesses in-depth knowledge of the publishing industry of magazines for female readers; and
• its strong and creative editorial and sales teams.

• Currently, the Group relies on two independent printers to carry out all of the Group's magazines printing. Should there be any disruption in the production process of the printers, the Group's business and operations may be adversely affected.
• The Group may not succeed despite making such efforts and such failure to effectively manage its expansion could cause its expenses to increase and its revenues to decline or grow more slowly than expected, and could otherwise have a material adverse effect on its business, financial condition and results of operations.
• The Group's future operating results may be subject to fluctuations due to a variety of factors, including competition and success in implementing its business strategies and expansion plans.
• Should the Group fail to collect the relevant trade receivables from its customers, the Group would have to make relevant provisions for bad and doubtful debts and the Group's financial position and profitability may be adversely affected.

To maintain its competitive edge, the Group will strive to enhance the content of its magazines. In this regard, the Group will continue to conduct reader surveys through independent surveyors and conduct its own focus group surveys to identify its potential readership base and keep abreast of readers' interests and needs. The Group will continue to improve the editorial content of its magazines in order to meet the needs of its readers through its experienced editorial team.

The Director consider that advertising income is a main source of income of the Group and that the quality content of the Group's magazines, together with the strong positioning of the Group's magazines in the market attract not only readers but also advertisers. In addition to the continuous improvement of the content of its magazines, the Group intends to attract more advertisers by holding more joint events with advertisers and by offering special packages for placing advertisements across the Group's magazines. The Group intends to increase the page rate advertising charge for all the Group's magazines when such magazines become more popular within the market.

The Group will adopt an active marketing strategy to enhance public awareness of the Group's magazines. Through a series of sales and marketing campaigns including multi-media advertising, subscription programs, special events and functions, on-pack premium gifts and readers' benefits, the Directors believe that the Group will effectively build up its brand recognition and expand its readership base and circulation within the respective existing target market segments.

The Directors intend to build upon the market position of the brand name "Jessica" as the name to be referred to by the public as the most widely-read Chinese language magazines for female readers in Hong Kong by increasing the use of the title name "Jessica" and expanding the range of the Group's publications to different target readers and market segments, such as the forthcoming publication of "Jessica Girl" magazine, a magazine that targets younger female readers aged between 18 and 25.

The net proceeds from the Placing, after deducting the related expenses, are estimated amount to approximately HK$9.2 million (based on the offer price HK$0.25 per share). The Group at present intends to apply the net proceeds as follows: