Press Releases

April 03, 2002

e-KONG Announces Final Results

HONG KONG, April 03, 2002 - e-KONG Group Limited (HKSE: 524) ("e-KONG " or the "Company", together with its subsidiaries, the "Group"), today announced its final results for the year ended December 31, 2001. Turnover for the year was HK$264 million, a 164% increase compared to 2000. This increase in turnover was achieved mainly due to the growth in ZONE telecommunications service businesses in Hong Kong, Singapore and the United States.

Loss attributable to shareholders for the year was HK$681 million. The operating loss of HK$253 million was mostly due to costs incurred during the growth and expansion phase of the Group's businesses. This year's loss was mainly attributable to non-recurring losses of HK$427 million which included HK$312 million resulting from decrease in the valuation of the Group's investments and HK$115 million from write-off of intangible assets and goodwill. The Group has taken a prudent approach to provision for devaluation of its investments in order to reflect their fair market value.

During this year the Group suffered considerable reductions in the valuation of its investments made in a number of technology and internet-related companies. These losses were prompted by declines in the worldwide equity markets, negative sentiment towards the technology sector and continuing difficulties encountered by 'new economy' businesses. Nevertheless, the Group's flagship IDD and telecom business ZONE, continues to experience steady and consistent growth.

In 2001, the Company underwent certain changes to its shareholding structure and Board composition. In December 2001, the Company successfully completed a two-for-one rights issue and raised net proceeds of approximately HK$128 million. As a result of the rights issue, Mr Kuldeep Saran and Mr William Bruce Hicks, who are also directors of Sunday Communications Limited and Distacom Communications Limited, increased their stake in the Company to about 4.0% and 4.5% respectively and they subsequently joined the Board. Also, following completion of the rights issue, Mr Richard Siemens, Chairman of the Company, became a substantial shareholder and the single largest shareholder.

"The decision to increase our shareholdings in the Company stems from our belief in the potential of the ZONE businesses, particularly in the US. ZONE is entering the largest telecommunications market at an opportune time when individual customers are demanding greater choice, better quality and best pricing while large corporations and enterprise customers are also looking for better ways to consolidate and manage their communication needs. ZONE has the unique technology and service offerings to meet customers challenging needs." said e-KONG's Chairman, Mr Richard Siemens.

"In the coming year we anticipate that ZONE1511 in Hong Kong and Singapore will collectively contribute towards the positive cashflow of the Group. As the US market offers tremendous opportunities for growth, the Group will be allocating a substantial portion of its available resources toward growing the ZONE business in the US." added Mr Derrick Bulawa, Chief Executive Officer of e-KONG, who has been spearheading the ZONE business in the US since April last year.

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About e-KONG Group Limited

e-KONG Group Limited, listed on the main board of the Hong Kong Stock Exchange (HKSE:524), pioneered the concept of converging services through innovative technical solutions and unique service offerings. e-KONG develops and services turnkey operations for global industries including telecom, corporate travel and meetings, and insurance. e-KONG's flagship business ZONE is focussed on providing such unique service offerings for the Domestic Long Distance (DLD) and International Direct Dialling (IDD) markets in the US, Hong Kong and Singapore using its patented advance technology.

For further information on e-KONG Group, please visit: www.e-kong.com

Please note: The correct form for the Company name is as follows: e-KONG (Lower-case "e" followed by a hyphen and upper-case KONG.)

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