Convenience Retail Asia Recorded Significant Growth In Turnover and Profit for First Quarter 2001

A joint venture agreement is reached with Shanghai Shen Hong Corporation and China Foreign Trade Development Companies Inc.
for expansion into Southern China

Hong Kong, 26th April 2001 - Convenience Retail Asia Limited ("CRA" or "the Group") [SEHK code: 8052] announced a net profit of HK$11.3 million for the three months ended 31st March 2001, representing a sharp increase of 136% over the same period last year (2000 1st quarter: HK$4.8 million).

The Group's turnover rose by 21% from HK$249 million recorded for the first quarter of 2000 to HK$301.9 million in 2001. Basic earnings per share were 1.8 HK cents, compared to 1.0 HK cent in first quarter 2000.

CRA is a subsidiary of privately held Li & Fung (Retailing) Limited and the licensee of the Circle K convenience store brand in Hong Kong and for most of the Mainland of China.

Dr. Victor K. Fung, Chairman of CRA, said, "We are very pleased to report strong growth for the Group despite a lackluster retail environment and conservative consumer spending locally in the past quarter. The Group's encouraging business performance, coupled with its successful listing on Hong Kong's Growth Enterprise Market during the period, has set a good start for us for the year."

Mr. Richard Yeung, Chief Executive Officer of CRA, commented, "The significant increases in both turnover and profit clearly demonstrate that our customer-driven business model, and strategies of cost control and product pricing have been successful and effective."

Excellence in customer services, aggressive promotions, and value pricing have helped to attract more customers to Circle K stores. Through better cost control and product pricing, the Group was able to increase gross margin and other income (excluding interest income) as a percentage of sales by 1.9% during the quarter. Stronger store sales combined with higher gross margin and other income helped boost the Group's net profit by a significant level.

At today's press conference, CRA also announced that it had reached an agreement to set up a joint venture - Convenience Retail Southern China Limited ("CRSC"). This joint venture will be responsible for leading the expansion of the Circle K network in the Southern part of China. CRSC is 62.5%-owned by the Group, whereas Shanghai Shen Hong Corporation ("Shen Hong") and China Foreign Trade Development Companies Inc. ("CFTDC") own the remaining 35% and 2.5% respectively.

Commenting on the joint venture, Mr. Richard Yeung said, "We feel very privileged to have Shen Hong and CFTDC as our China partners. CRSC will leverage the solid business experience of Shen Hong and its parent company Shanghai Friendship Group, and will also benefit from Guangdong-based CFTDC's extensive knowledge in business development."

Application of a PRC business license is in progress. Subject to approval from the respective authorities, the Group will start operations in Guangzhou.

While the Group continues with its aggressive expansion plan in Hong Kong, growth in profit will slow down, as expected, to a moderate rate due to the uncertainty of the retail environment in Hong Kong. It is also anticipated that the Group shall incur start up costs from new operations in the Mainland of China.

About CRA
Convenience Retail Asia is engaged in the operation of one of the leading convenience store chains in Hong Kong under the brand name of Circle K. The Circle K store chain comprises 126 company owned-and-managed stores in Hong Kong as of 31st March 2001. Major initiatives are planned for expansion into the southern part of the Mainland of China.

About Shen Hong
Shanghai Shen Hong Corporation is majority-owned by Shanghai Friendship Group, which is primarily engaged in the operation of Shanghai Lian Hua Supermarket and Shanghai Friendship Department Store.

About CFTDC
China Foreign Trade Development Companies Inc. is a state-owned enterprise in Guangdong Province, the PRC. It serves as a multi-function business entity to facilitate import and export, logistics, and provide trade-related services.

For more information, please contact:

CRA corporate website: www.cr-asia.com