Ar 2008

www.reyoung.com.
sg
Making You
Our Priority
Reyoung Pharmaceutical Holdings Limited

(Incorporated in Bermuda on 26 October 2004)
No. 6 Erlangshan Road, Yi Yuan County

Shandong, PRC 256100
Tel: 86 533 3237275
Fax: 86 533 3244471
Annual Report 2008

Contents
02 Corporate Prof ile
04 Chairman’s Statement
06 Corporate Information
08 Financial and Operations Review
11 Financial Highlights
12 Board of Directors
14 Key Management
17 Corporate Governance Report
24 Financial Contents
Corporate Profile
Reyoung Pharmaceutical Holdings Limited (the “Company”) was incorporated in Bermuda on 26 October 2004 and its shares
were listed on the Main Board of the Singapore Exchange Securities Trading Limited in September 2005.
The organisation chart of the Company and its subsidiaries (the “Group”) is shown as follows:
Reyoung Pharmaceutical Holdings Cofan Wealth

Limited (the “Company”) 100% Corporation
100% 100% 100%
Wealthy Summit Corporation Triumphant Empire Inc. Wise Achievement Inc.
100%
Shandong Yimoo Women

Necessities Co., Ltd.
(‘Shandong Yimoo”)
51% 49%
Shanghai Yimoo Women

Necessities Co., Ltd.
100% 100%
(‘Shanghai Yimoo”)
Reyoung Pharmaceutical Co., Ltd. Ways (HK) Investment Limited
(“Reyoung”)
The businesses of the Group are classified into 2 segments, namely the pharmaceutical segment and the personal hygiene
segment as follows:
Pharmaceutical Segment Personal Hygiene Segment

Our pharmaceutical products are sold principally under our Our personal hygiene products comprise mainly sanitary
“Reyoung” (瑞阳) brand name. Our pharmaceutical products napkins and disposable baby diapers.
include penicillin-based antibiotics, Traditional Chinese
Leveraging on our strengths in medicinal R&D, we have
Medicine (“TCM”) formulated products, cephalosporin-based
branched into the design, manufacture and distribution of
antibiotics and western medicine.
personal hygiene consumer products in 2002.
For our pharmaceutical business, we have enjoyed a strong
Our sanitary napkins and pantyliners are sold under our “Yimu”
track record in successfully commercializing our now highly-
(益母) brand name. These products contain our patented
rated products, distributed under our “Reyoung” (瑞阳) brand
proprietary blend of yimu herbs which are formulated based
name, directly to hospitals, licensed wholesalers, and local
on TCM principles.
pharmacies in the People’s Republic of China (the “PRC”).
We also manufacture and sell disposable baby diapers under
One of our top-selling antibiotics, Mezlocillin Sodium,
our own brand names “Yibei” (益贝) and “Tiaopidan” (调皮
commands significant market share for our penicillin-based
蛋), which have since evolved into household names in the
antibiotics. We have also seen great potential growth in our
PRC.
cephalosporin-based antibiotics where we intend to maintain
our position as the leader in product innovation and sales.
We believe we are one of the few Chinese groups with the
technology to make cephalosporin-active ingredients.
0 Annual Report 2008

For You,
We Explore
New Research and Development
Annual Report 2008 0

Chairman’s Statement
Dear Shareholders,
FY2008 was another year marked with significant growth for
our pharmaceutical segment despite the keen and competitive
environment in which we operate. Since our successful listing
on the Main Board of the Singapore Exchange Securities Trading
Limited on 8 September 2005, we have expanded our production
facilities in the pharmaceutical segment. This has laid a strong
foundation in strengthening our position as one of the premier
drug manufacturers in the PRC. Compared to previous years,
FY2008 was also a challenging year for our personal hygiene
segment, as we encountered keen competition from foreign
brands. We are modifying our sales and marketing strategies so
as to extend our existing sales network.
Key Corporate Developments

Due to the ongoing medical reforms in the PRC and as indicated
in our results announcements, demand for our pharmaceutical
products continued to show strong momentum. The
construction of our new production facilities has been completed
and production is scheduled to commence in the second half
year of 2009. We believe our production capacity will increase
significantly thereafter to meet the increased demand.
Business Highlights and Results

Operating market conditions of the pharmaceutical industry
in the PRC were very challenging for the Group in FY2008. In
order to increase our market share in that environment, we had
in early 2008 reduced our selling prices for our cephalosporin-
based products.
Increased demand for cephalosporin-based and penicillin-based
products, especially Mezlocillin Sodium, boosted sales volume
which substantially alleviated the effect of this challenge. The

Due to the medical reforms in the PRC and as indicated in our results
announcements, demand for our pharmaceutical products continued to
show strong momentum. We believe with the completion of the new
production facilities our production capacity will increase significantly
thereafter to meet the increased demand.
revenue from our pharmaceutical segment had increased by Appreciation

26.4% from RMB579.5 million in FY2007 to RMB732.7 million
On behalf of the Board, I express my sincere thanks to
in FY2008. However, the revenue from our personal hygiene
our employees for their hard work and dedication, to our
segment had decreased by 43.3% from RMB144.2 million in
Directors for their contributions and support, to our business
FY2007 to RMB81.7 million in FY2008. Our pre-tax profit had
partners for their trust in the Group, and to our shareholders
decreased by 46.8% to from RMB91.6 million in FY2007 to
for sharing our vision.
RMB48.7 million in FY2008 and our net profit attributable to
equity holders had also decreased by 46.0% from RMB75.8 To the two retiring Directors, Mr Bernard Tay and Dr Chong
millionin in FY2007 to RMB40.9 million in FY2008. Weng Chiew who had indicated that they do not wish to
seek re-election at the forthcoming Annual General Meeting,
The Board, after having carefully considered the Group’s
I would also like to express my appreciation to them for their
cash reserves and working capital requirements, did not
services and contributions to the Company.
recommend any payment of dividend for FY2008. We hope
to conserve our resources to strengthen our working capital We look forward to your continued support for another year
to focus on business development and expansion. of success.
Details of the Group’s performance and developments during

the year are set out in “Financial and Operations Review” on
page 8 to page 10 of this annual report.
Looking Ahead Mr. Zhao Yushan

To maintain our competitiveness, we will continuously Executive Chairman
improve and upgrade our research and development
capabilities to improve our current products and to develop
new products to meet our customers’ needs. At the same
time, we will also exercise tighter control on our operating
costs and strive to offer our products at the most competitive
price for the best quality.
The Group is preparing for the challenging times ahead
arising from the unprecedented global financial crisis. Besides
striving to contain costs, we aim to effectively and efficiently
utilise our resources to overcome the challenges faced.

Corporate Information
BOARD OF DIRECTORS SINGAPORE SHARE TRANSFER AGENT

Zhao Yushan (Executive Chairman) Boardroom Corporate & Advisory Services Pte. Ltd
He Maoqun (Executive Director) 3 Church Street #08-01
Dr Chong Weng Chiew (Independent Director) Samsung Hub
Ong Tiong Seng (Independent Director) Singapore 049483
David Zheng Fangshun (Independent Director)
Bernard Tay Ah Kong (Independent Director) AUDITORS
Grant Thornton
COMPANY SECRETARY/ DEPUTY SECRETARIES Certified Public Accountants
Leung Wai Ping Noel, CPA, FCCA, ACA 13th Floor, Gloucester Tower
Yvonne Choo, FCIS The Landmark
Hazel Chia Luang Chew, FCIS 15 Queen’s Road Central
Hong Kong SAR
REGISTERED OFFICE
Canon’s Court Partner-in-Charge: Norman Tsui
22 Victoria Street (Since the financial year ended 31 December 2007)
Hamilton HM 12
Bermuda PRINCIPAL BANKER
Industrial and Commercial Bank of China, Yi Yuan Sub-Branch
HEAD OFFICE AND PRINCIPAL PLACE OF BUSINESS (中国工商银行沂源县支行)
No. 6 Erlangshan Road No. 29 Lushan Road, Yi Yuan County,
Yi Yuan County Shandong Province,
Shandong Province, People’s Republic of China 256100 People’s Republic of China
Telephone number: 86-533-3237275 (中国山东省沂源县城鲁山路29号)
Fax number: 86-533-3244471
BERMUDA SHARE REGISTRAR AND SHARE TRANSFER

AGENT
The Bank of Bermuda Limited
6 Front Street, Hamilton HM 11
PO Box HM 1020
Hamilton HM DX
Bermuda

For You,
We Innovate
Breakthrough Products

Financial and
Operations Review
Revenue Other revenue

Sales of our pharmaceutical products increased by RMB153.2 Other revenue decreased by RMB3.9 million or 66.1% from
million or 26.4% from RMB579.5 million in FY2007 to RMB732.7 RMB5.9 million in FY2007 to RMB2.0 million in FY2008. The
million in FY2008 due to an increase in demand for our decrease was due mainly to a write-back of an allowance no
pharmaceutical products by medical organisations in the PRC longer required for doubtful debts in FY2007.
arising from the ongoing medical reforms currently being
implemented in the rural areas by the PRC Government. In
order to increase our market share in a competitive operating Selling and distribution costs
environment, we had in the early 2008 reduced our selling Selling and distribution costs increased by RMB5.5 million or
prices for our cephalosporin-based products. This move had 4.0% from RMB137.8 million in FY2007 to RMB143.3 million in
also successfully driven up the sales volume of our other FY2008 mainly due to an increase in selling commission payable
pharmaceutical products. This accounted for the significant to the sales representatives of our pharmaceutical division,
increase in our aggregate sales volume, which reduced Reyoung, in line with the increase in revenue. However, selling
the impact of lower selling prices for cephalosporin-based and distribution costs to sales ratio decreased from 19.0% to
products. 17.6% due to tighter cost control measures implemented by
Sales of our personal hygiene products decreased by RMB62.5 the management since early 2008.
million or 43.3% from RMB144.2 million in FY2007 to RMB81.7
million in FY2008 due to the keen competition from foreign
brands that have significantly affected the sales volume of our
personal hygiene products.
Overall gross profit decreased by RMB11.6 million or 3.8% from
RMB303.7 million in FY2007 to RMB292.1 million in FY2008
despite the increase in the Group’s revenue. Although, the
gross profit for our pharmaceutical products increased by
RMB20.0 million or 8.5% from RMB234.7 million in FY2007 to
RMB254.7 million in FY2008 in line with the increase in revenue,
gross profit margin decreased from 40.5% in FY2007 to 34.8%
in FY2008 because of the lower selling prices implemented to
capture market share. For personal hygiene products, gross
profit significantly decreased by RMB31.6 million or 45.8%
from RMB69.0 million in FY2007 to RMB37.4 million in FY2008,
in line with the decrease in revenue. Gross profit margin also
decreased from 47.9% in FY2007 to 45.8% in FY2008 due to
the rising cost of raw materials since June 2007.

Administrative expenses
Administrative expenses increased by RMB8.5 million or
16.5% from RMB51.4 million in FY2007 to RMB59.9 million in
FY2008 mainly due to a rise in staff costs, resulting from an
increase in the number of employees and salary increment
for emplyees of our pharmaceutical division, Reyoung.
Further, in line with the increase in (i) manpower and (ii)
land and property, plant and equipment, the corresponding
insurance costs and amortisation charges rose respectively.
Other operating expenses

Other operating expenses increased by RMB10.6 million or
68.4% from RMB15.5 million in FY2007 to RMB26.1 million
in FY2008 mainly due to an increase in research and
development expenditure by our pharmaceutical segment, plant and facilities for cephalosporin-based products.
Reyoung.
Inventories increased by RMB15.7 million or 11.1% from
RMB142.0 million as at the end of FY2007 to RMB157.7 million
Finance costs as at the end of FY2008 in line with the increase in revenue
of pharmaceutical products.
Finance costs rose by RMB2.8 million or 21.1% from RMB13.3
million in FY2007 to RMB16.1 million in FY2008 mainly due to Despite the increase in revenue of our pharmaceutical
the increase in outstanding bank borrowings. products, trade and bills receivables decreased by RMB4.3
million or 3.0% from RMB142.4 million as at the end of FY2007
to RMB138.1 million as at the end of 2008 due to an increase
Income tax expense in cash sales in 4Q2008 and better cash management.
A provision of 12.5% for PRC income tax has been made for Prepayments, other receivables and deposits decreased
Reyoung and Shandong Yimoo in the consolidated financial by RMB11.3 million or 38.3% from RMB29.5 million as at the
statements of the Group in FY2008. No provision for PRC end of FY2007 to RMB18.2 million as at the end of FY2008
income tax for Shanghai Yimoo was made as Shanghai mainly due to (i) better cash management as cash advances
Yimoo did not have any taxable profit in FY2008. to our sales representatives decreased by RMB3.5 million, (ii)
the settlement of loan to a third party of RMB1.7 million; and
Taxation decreased by RMB7.9 million or 50.0% from RMB15.8
(iii) the decrease in miscellaneous prepayments and other
million in FY2007 to RMB7.9 million in FY2008 in line with the
receivables.
decrease in operating profit.
Time deposits pledged to banks to secure bills payables
decreased by RMB0.9 million or 2.7% from RMB32.9 million
Cash flow/Balance sheet review as at the end of FY2007 to RMB32.0 million as at the end of
FY2008.
Property, plant and equipment increased by RMB54.4 million
or 13.7% from RMB397.3 million as at the end of FY2007 to Trade and bills payables decreased by RMB1.9 million or 1.2%
RMB451.7 million as at the end of FY2008. The increase was from RMB160.1 million as at the end of FY2007 to RMB158.2
due to the construction work on sewage treatment and the million as at the end of FY2008 as there was an increase in
purchases of plant and machinery for the new production cash purchases in 4Q2008.

Accrued liabilities, other payables and deposits received

decreased by RMB8.3 million or 16.5% from RMB50.3 million
as at the end of FY2007 to RMB42.0 million as at the end of
FY2008 mainly because of the settlement of accrued bonus
to the management and the settlement of cost of land use
right.
Total bank borrowings increased by RMB60.8 million or 28.6%
from RMB212.9 million as at the end of FY2007 to RMB273.7
million as at the end of FY2008 as the Group obtained new
bank loans totaling RMB271.0 million and repaid matured bank
loans totaling RMB210.3 million for the year.
Positive cash flows from operations were generated in FY2008.
The net cash generated from operating activities of RMB73.3
million and the net cash generated from bank borrowings of
RMB60.7 million have utilised mainly for capital expenditures
of RMB97.7 million and payment of FY2007 final dividends of
RMB15.3 million.
Financial Position and Liquidity

The Directors believe the financial position of the Group
is healthy, with sufficient financial resources to meet the
requirement for its operations and current expansion plans.
Contingent Liabilities
As at 31 December 2008, the Group had no material contingent
liabilities.
Prospects
We are continuously operating in a very keen and competitive
environment for both our product segments.
For our pharmaceutical segment, we had since 1Q2008
commenced construction of our new production facility.
Production in this new facility is scheduled to commence in
3Q2009.
For the personal hygiene segment, we are continuously facing
competition from foreign brands. We are planning to expand
our personal hygiene products into other parts of the PRC.
Barring unforeseeable circumstances, the Group expects to be
profitable in 2009.

Financial Highlights
91.6
86.3 91.6 26.4
814.4 26.4
86.3
723.7 814.4 74.8 21.6
22.7
21.5 22.7
656.9 723.7 65.7 74.8 21.6 21.5
580.9 656.9 65.7
538.0 580.9
538.0 48.7
48.7 12.3
12.3
04 05 06 07 08 04 05 06 07 08 04 05 06 07 08
04 05 06 07 08 04 05 06 07 08 04 05 06 07 08
Revenue Profit Before Income Tax EPS

RMB’ million RMB’ million RMB’ cents
Notes:
• For illustrative purpose, pro forma financial information is shown for FY2004 in this section.
• The calculation of EPS is based on the profit attributable to equity holders of the Company and on the 333,400,000 ordinary shares in issue for
the years 2006 to 2008 (2005: weighted average number of shares of 283,126,027; 2004: pre-invitation number of shares of 260,000,000).
Revenue by Products
RMB 81m RMB 144m

RMB 81m RMB 144m
RMB 733m RMB 580m

RMB 733m RMB 580m
08 07
08 07
Personal Hygiene Pharmaceutical

Board of Directors
Mr Zhao Yushan (赵玉山) Dr Chong Weng Chiew

Executive Chairman Independent Director
Mr Zhao Yushan (赵玉山) is the Executive Chairman and a Dr Chong Weng Chiew was appointed as an Independent
founder of our Group. He was appointed as Director of the Director on 7 April 2005 and was last re-elected on 28 April
Company on 3 December 2004 and was last re-elected on 30 2006. Dr Chong is a medical doctor. From January 2003 to June
April 2007. He is responsible for planning the business direction 2005, Dr Chong was the Chief Executive Officer of Ang Mo Kio
and development of the Group. Hospital. Prior to joining Ang Mo Kio Hospital, Dr Chong was
the medical director of Thye Hua Kwan Moral Society from
Mr Zhao was appointed as chairman of Reyoung in November
December 2001 to December 2002, the medical director
1998, chairman of Shandong Yimoo in October 2002 and
of Singapore Buddhist Welfare Services from May 1997 to
chairman of Shanghai Yimoo in July 2004. Mr Zhao holds a
November 2001, and a medical doctor with the Ministry of
Bachelor’s Degree in Engineering from 山东轻工业学院
Health (Singapore) Health Care from May 1993 to April 1995.
(Shandong Light Industries College). Mr Zhao is also a Yi Yuan
delegate representative to the 12th Zibo People’s Congress. Dr Chong holds a MBBS (Bachelor of Surgery, Medicine)
degree from the National University of Singapore and has
Mr He Maoqun(何茂群) been a Member of Parliament representing the Tanjong Pagar
Executive Director Group Representation Constituency from October 2001 to
April 2006.
Mr He Maoqun (何茂群) is the Executive Director and a founder
of the pharmaceutical products business of our Group. He was Dr Chong is also an independent director of Fibrechem
appointed as Director of our Company on 3 December 2004 Technologies Limited, United Envirotech Limited, Cacola
and was last re-elected on 30 April 2008. He is responsible for Furniture International Ltd, all of which are companies listed
assisting our Executive Chairman, Mr Zhao Yushan (赵玉山) in on the SGX-ST.
the strategic planning, development, daily management and
supervision of our pharmaceutical products business.
Mr He is also responsible for overseeing the internal controls
of our pharmaceutical products business. Mr He holds a
Bachelor’s Degree in Education from 山东教育学院 (Shandong
Education College).

Mr Ong Tiong Seng Mr Bernard Tay Ah Kong
Independent Director Independent Director
Mr Ong Tiong Seng was appointed as an Independent Mr Bernard Tay Ah Kong was appointed as an Independent
Director on 7 April 2005 and was last re-elected on 30 April Director on 7 April 2005 and was last re-elected on 30 April
2007. Mr. Ong is currently the Chairman of Cogent Financial 2007. Mr Bernard Tay Ah Kong is currently the Non-Executive
Group (HK) Limited, an investment fund company. He is Chairman of Horwath First Trust, which is a Certified Public
also the Vice Chairman of Provenance Capital Pte Ltd, an Accountants firm and a member of the Risk Management
investment banking business. Committee of KW Capital Pte Ltd, an approved SGX Continuing
Sponsor. Mr Tay is also an Independent Director of several
Prior to joining the private sector, Mr Ong worked with the
public companies listed on the SGX Mainboard and Catalist
Economic Development Board of Singapore.
including China Hongxing Sports Ltd, Hengxin Technology
Mr. Ong graduated with a Bachelor of Commerce Degree Ltd, Juken Technology Limited, Man Wah Holdings Limited,
(Banking and Finance) from University of Canberra in 1992 and Oakwell Engineering Limited, China Yongsheng Limited
a Masters of Economics Degree from Macquarie University, and Ramba Energy Limited. He is the Senior Advisor to
Australia in 1993. the Government of Huzhou City, Zhejiang Province, PRC,
Mr. Ong is also an independent director of a number of President of the Automobile Association of Singapore and
public companies listed on SGX which include Fibrechem Vice- President of the Singapore Productivity Association. He
Technologies Limited, Brigh World Precision Machinery is also a sub-committee member of the Singapore Institute
Limited, China Paper Holdings Limited and Pine Agritech of Directors. Mr Tay is a recipient of the Service to Education
Limited. Award and Community Service Medal and was conferred the
Pingat Bakti Masyarakat (Public Service Medal) by the President
of Singapore in 1990. In addition, he is a former member
Mr David Zheng Fangshun(郑方顺)
Independent Director of the Resource Panel of the Government Parliamentary
Committees for Home Affairs and Communications. He
Mr David Zheng Fangshun (郑方顺) was appointed as had also sat on several committees under the Accounting
an Independent Director on 7 April 2005 and was last re- and Corporate Regulatory Authority which includes the
elected on 30 April 2008. Mr Zheng is currently the Director Complaints and Disciplinary Panel - Public Accountants
of Finance and Human Resources of Mettler-Toledo, China Oversight Committee, Standing Law Review Focus Group
Region (梅特勒-托利多) and President of Mettler-Toledo and Directors’ Duties Study Team. Mr Tay is a Fellow of the
(Changzhou) Scale & System Ltd. Mettler-Toledo is a Swiss Association of Chartered Certified Accountants (U.K.), the
company engaged in manufacture and sales of weighing Institute of Certified Public Accountants of Singapore, the
instruments and solutions. Taxation Institute of Australia and the Singapore Institute of
Mr Zheng graduated from the Shanghai University of Finance Directors. He is also a Chartered Accountant of Malaysia. Mr
and Economics with a Bachelor of Economics degree Tay has a wide range of experience, from having worked in
(accounting major). Mr Zheng also holds a Masters Degree in public accounting firms in the United Kingdom and Singapore,
Accounting from the Washington State University. the Inland Revenue Authority of Singapore and companies
in commerce, industry and management consulting for a
period over 30 years.

Key Management
Mr Miao Dezu (苗得足) is the Manufacturing and From March 1998, Mr Cui served as Chief of Finance as well
Technology Development Chief Officer, Pharmaceutical as Assistant Operations Manager of Reyoung. From December
Products of our Group and is responsible for the development 2001 to October 2003, Mr Cui served as Deputy General
and enhancement of production technology for our Group’s Manager - Finance of Reyoung. Mr Cui has served as the Vice
pharmaceutical products business. Mr Miao joined Reyoung President of the Sales and Marketing department of Reyoung
(formerly known as 山东沂蒙新华药业有限公司 (Shandong since November 2003. Mr Cui was appointed a director of
Yimeng Xinhua Pharmaceutical Co., Ltd.)) as an assistant Shandong Yimoo in October and a director of Reyoung in
supervisor of the production department in April 1993. August 2003.
From February 1996 to February 1998, Mr Miao served as Head Mr Cui holds a Certificate in Financial Accounting from 山
of the Production Department of Reyoung. From March 1998 东广播电视大学 (Shandong Broadcasting and Television
to October 2003, Mr Miao served as Deputy General Manager University).
- Technology and Development of Shandong Reyoung.
Mr Miao has served as the Vice President - Technology and Mr Zhang Jinke (张金科) is our Chief Financial Officer
Development (Pharmaceutical Products) of our Group since and the financial management and accounting matters of
November 2003. Mr Miao was appointed a director of Reyoung our Group in the PRC. Mr Zhang joined Reyoung in 1995 as
in August 2003. Head of Office Administration and Manager of Foreign Trade
Department. Mr Zhang held various managerial positions in
Mr Miao holds a Certificate in Corporate Management from
our Group since 1995 and was appointed a director of Reyoung
山东广播电视大学 (Shandong Broadcasting and Television
in August 2003.
University).
Prior to joining our Group, Mr Zhang was from 1994 to 1995, the
Mr Cui Weishen (崔维慎) is the Sales and Marketing Chief Head of Research and Product Development of 山东省药用
Officer, Pharmaceutical Products, of our Group and is 玻璃股份有限公司 (Shandong Pharmaceutical Glass Co., Ltd.),
responsible for the sales and marketing of our Group’s a company which was previously a shareholder of Reyoung ,
pharmaceutical products. Mr Cui joined Reyoung as Deputy where he was responsible for product development.
Head of Finance Department in September 1995.
Mr Zhang holds a Certificate in Computer Science from 山东省
机械工业学校 (Shandong Mechanical and Industrial School).

Mr Ren Zhengwei (任正伟) is the Product Development Mr Tan Fuping (谭福平) is the Product Development
Chief Officer, Pharmaceutical Products of our Group and Chief Officer, Personal Hygiene Products of our Group and
is responsible for product development of our Group’s is responsible for the product development of our Group’s
pharmaceutical products business. Mr Ren also oversees the personal hygiene products business. Mr Tan also oversees the
legal department of our Group’s pharmaceutical products intellectual property related maters of our Group’s personal
business. Mr Ren joined Reyoung as its Executive Secretary in hygiene products business. Prior to joining our Group, Mr Tan
January 1993. served as the Deputy General Manager of 博源建材开发公司
(Bo Yuan Construction Materials Co., Ltd) from March 1993 to
From March 1998 to October 2003, Mr Ren served as the
February 1996.
Assistant General Manager and Executive Secretary of
Reyoung. Mr Ren has served as the Vice President - Product In March 1996, Mr Tan joined, from which Shandong Yimoo
Development (Pharmaceutical Products) and Head of Legal acquired its personal hygiene products business in October
Affairs of Reyoung since November 2003. 2002, first as Finance Manager and than as Purchase Manager.
Upon the acquisition by our Group of the personal hygiene
Mr Ren holds a certificate in Electrical Engineering from 山
products business in October 2002, Mr Tan became the Vice
东广播电视大学 (Shandong Broadcasting and Television
President - Product Development (Personal Hygiene Product)
University).
and Deputy General Manager of Shandong Yimoo. Mr Tan
has also been the Support and Administration Manager of
Mr Zhou Zuochuan (周作传) is the Manufacturing and Shanghai Yimoo since April 2003.
Technology Development Chief Officer, Personal Hygiene
Products of our Group and is responsible for the development Mr Tan graduated from 山东经济学院 (Shandong Economy
and enhancement of production technology for our Group’s College) with a Certificate in Accounting.
personal hygiene products business. In April 1996, Mr Zhou
joined 山东淄博蓝海妇女用品有限公司 (“Zibo Lanhai”), Mr Hu Shifu (胡世福) is the Human Resources, Chief Officer
from which Shandong Yimoo acquired its personal hygiene and is responsible for overseeing and planning our human
products business in October 2002, and held various positions resource requirements. He joined our Group in December
in the same from April 1996 to September 2002. Upon the 2003. From 1993 to 1996, Mr Hu served as the factory deputy
acquisition by our Group of the personal hygiene products manager of 山东淄博美术陶瓷厂 (Shandong Zibo Ceramic
business of Zibo Lanhai in October 2002, Mr Zhou became Factory). From February 1996 to November 2003, Mr Hu
the Vice President - Technology and Development (Personal served as the Chief Engineer of 威海市瓷厂 (Weihai Ceramic
Hygiene Products) of our Group. Mr Zhou holds a Certificate Factory).
in Electrical Engineering from 西安电子科技大学 (Xi’an
Mr Hu holds a Bachelor Degree in Engineering from 山东轻工
Electronic Technology University).
学院 (Shandong Light Industries College).

Mr Wang Luoyu (王洛玉) is the Quality Control, Chief Mr Liu Hongwei (刘红卫) is the Purchasing Chief Officer
Officer and is responsible for overseeing the quality control of our Group. From May 1990 to February 1996, Mr Liu was
departments of our Group. Mr Wang joined Reyoung in July the production supervisor and assistant head of sales of 山东
1989 upon his graduation from 山东医科大学 (Shandong 省药用玻璃股份有限公司 (Shandong Pharmaceutical Glass
Medical University). Co., Ltd.), a company which was previously a shareholder of
Shandong Reyoung.
From September 1993 to July 1995, Mr Wang served as a
production supervisor of Reyoung. From August 1995 to Mr Liu joined Reyoung in March 1996 as the head of its
February 1998, Mr Wang served as a Quality Control Officer of purchasing department. From March 1998 to November
the quality control department of Reyoung. From March 1998 2003, Mr Liu served as the manager of Shandong Reyoung’s
to October 2003, Mr Wang was promoted progressively to purchasing department. Mr Liu was promoted to his present
Quality Control and Inspection Officer and Assistant Manager position as Chief Purchasing Officer of our Group from
of the quality control department of Reyoung. Mr Wang has December 2003.
served as Chief Officer of Quality Control of our Group since
Mr Liu holds a Bachelor Degree in Economic Management from
November 2003.
中共山东省委党校 (Institute of Shandong CPC Committee).
Mr Wang holds a Bachelor Degree in Medicine from 山东医科
大学 (Shandong University of Medicine). Mr Leung Wai Ping, Noel is the Group Financial Controller
and Company Secretary of the Company. Mr Leung joined
the Company in July 2008. Mr Leung is in-charge of finance
and accounting operations of the Group. Mr Leung has over
eighteen years of experience in auditing, accounting and
finance. Mr Leung holds degrees of a Master of Business
Administration from the University of Lincoln and a Master of
Arts from the City University of Hong Kong. Mr Leung is an
associate member of the Hong Kong Institute of Certified
Public Accountants and The Institute of Chartered Accountants
in England and Wales and a fellow member of the Association
of Chartered Certified Accountants.

Corporate Governance Report
The Board is committed to maintaining a high standard of corporate governance within the Group and has adopted the
recommendations of the Code of Corporate Governance (2005) (the “Code”). The Company confirms that it has adhered to
the principles and guidelines as set out in the Code, where applicable, and has specified and explained the areas of non-
compliance.
BOARD MATTERS
Principle 1 : Board’s Conduct of its Affairs
The Board oversees the business affairs of Reyoung and each member of the Board is expected to act in good faith and to
always consider the interest of the Group. It assumes responsibility for the Group’s overall strategic plans, key operational
initiatives, major funding and investment proposals, financial performance reviews and corporate governance practices.
The Board is supported by three Board Committees, namely the Audit Committee, the Remuneration Committee and the
Nominating Committee.
The Board conducts regular scheduled meetings at least four times a year and meets as and when warranted by particular
circumstances between the scheduled meetings. The Company’s bye-laws provide for meetings to be held via telephone
and video conferencing. In lieu of physical meetings, written resolutions are also circulated for approval by the Board.
Details of Directors’ attendance at the Board and Board committee meetings for FY2008 are summarized in the table below:
Nominating Remuneration
Meeting of Board Audit Committee Committee Committee
Total held in FY2008 5 4 1 1

Zhao Yushan 5 – – –
He Maoqun 5 – – –
Dr Chong Weng Chiew 5 4 1 1
Tony Ong Tiong Seng 4 4 1 1
David Zheng Fangshun 3 3 1 1
Bernard Tay Ah Kong 5 4 1 1
Li Chungong
(Resigned as a Director on 15 May 2008) 1 – – –
Principle 2 : Board Composition
On 15 May 2008, one of our Executive Directors, Mr Li Chungong resigned.
Presently, the Board comprises six Directors of whom two are Executive Directors, and four are Independent Directors.
Executive Directors:
Zhao Yushan - Chairman

He Maoqun

Independent Directors:
Dr Chong Weng Chiew*

Ong Tiong Seng
David Zheng Fangshun
Bernard Tay Ah Kong*
Note: -
* Dr Chong Weng Chiew and Mr Bernard Tay Ah Kong will be retiring at the forthcoming Annual General Meeting and will not be seeking re-election.
The profile of the Board members is set out in the section entitled “Board of Directors”.
The present composition of the Board complies with the Code’s guidelines that Independent Directors make up at least
one-third of the Board. The Board is of the view that, given the scope and nature of the Group’s operations, the present size
of the Board is more than adequate in facilitating effective decision-making.
As a Group, the Directors bring with them a broad range of expertise and experience in areas such as accounting, finance,
business and management experience, industry knowledge, strategic planning experience and customer-based experience
and knowledge. The diversity of the Directors’ experience allows for the useful exchange of ideas and views.
Independent Directors contribute to the Board process by monitoring and reviewing Management’s performance against
the Group’s targeted goals and objectives. Their views and opinions provide different perspectives to the Group’s business.
When challenging Management proposals or, decisions, they bring independent judgement to bear on business activities
and transactions involving conflicts of interest and other complexities.
Principle 3 : Executive Chairman
Currently, the Executive Chairman is Mr Zhao Yushan. Mr Zhao is one of the founders of the Group and plays a key role in
developing the business of the Group and provides the Group with strong leadership and vision. He is responsible for the
day-to-day running of the Group as well as the exercise of control of the quality, quantity and timeliness of information flow
between the Board and Management.
All major decisions made by the Executive Chairman are reviewed by the Board. His performance and appointment to the
Board is reviewed periodically by the Nominating Committee and his remuneration package is reviewed periodically by the
Remuneration Committee. Both the Nominating Committee and the Remuneration Committee comprise Independent
Directors. As such, the Board believes that there are adequate safeguards in place against an uneven concentration of
power and authority in a single individual.
As Executive Chairman of the Board, Mr Zhao bears responsibility for the effective working of the Board. He is responsible
for amongst others, ensuring that Board meetings are held when necessary, setting the board meeting agenda in
consultation with the Group Financial Controller and the Company Secretaries, assisting in ensuring compliance with the
Group’s guidelines on corporate governance, acting as a facilitator at Board meetings and maintaining regular dialogue with
the management on all operational matters.

Principle 4 : Board Membership
Nominating Committee (“NC”)
The NC, regulated by a set of written terms of reference, comprises four members, of whom all are Independent Directors
including the Chairman of the NC who is independent or who is not directly associated with, any substantial shareholder.
The current members of the NC are as follows:
Dr Chong Weng Chiew (Chairman)

Ong Tiong Seng
Bernard Tay Ah Kong
The NC makes recommendations to the Board on all nominations for new appointments and re-appointments to the
Board and the Board Committees. It ascertains the independence of Independent Directors and evaluates the Board’s
performance.
In accordance with the Company’s Bye-Laws, each Director (except Managing Director) is required to retire at least once
in every three years by rotation and all newly appointed Directors will have to retire at the next Annual General Meeting
(“AGM”) following their appointments. The retiring Directors are eligible to offer themselves for re-election.
Dr Chong Weng Chiew and Mr Bernard Tay Ah Kong will be retiring by rotation at the forthcoming AGM. Both Dr Chong
Weng Chiew and Mr Bernard Tay Ah Kong have, however, indicated their intention not to seek re-election.
Newly appointed Directors are provided with background information about the Group’s history, business operations, vision
and values and those who have no prior experience as Directors of a listed company will undergo training and briefing on
the role and responsibilities as a Director of a listed company. The current Directors have been in office since the Company’s
listing on SGX-ST in September 2005.
Principle 5 : Board Performance
The Company acknowledges the importance of having a formal assessment of the Board performance and has adopted a
formal system of evaluating the performance of the Board as a whole. An evaluation of the performance of the Board will
be conducted annually to identify areas of improvement and as a form of good Board management practice.
The evaluation on the performance of the Board as a whole deals with matters on Board composition, information to the
Board, Board procedures, Board accountability and chief executive officer/top management.
Principle 6 : Access to Information
Board members are provided with adequate and timely information on affairs and issues that require the Board’s decision.
As a general rule, detailed Board papers are prepared for each meeting and are normally circulated in advance of each
meeting. All Directors have independent access to the Group’s senior management and the Company Secretaries. All
Directors are provided with complete and adequate information prior to Board meetings and on an ongoing basis. The
Company Secretaries provide secretarial support to the Board, ensuring adherence to Board procedures and relevant rules
and regulations which are applicable to the Company. The Company Secretaries attend all Board meetings.
Should Directors, whether as a group or individually, need independent professional advice to fulfill their duties, such advice
will be obtained from a professional entity of the Director’s choice and the cost of such professional advice will be borne by
the Company.

Remuneration Committee (“RC”)
Principle 7 : Procedures for Developing Remuneration Policies

Principle 8 : Level and Mix of Remuneration
Principle 9 : Disclosure on Remuneration
The RC, regulated by a set of written terms of reference, comprises four members, all of whom are Independent Directors.
The current members of the RC are as follows:
Ong Tiong Seng (Chairman)

Dr Chong Weng Chiew
Bernard Tay Ah Kong
The RC reviews and recommends to the Board (a) the remuneration packages of all Executive Directors and Executive
Officers of the Group, (b) directors’ fees for Independent Directors, which are subject to shareholders’ approval at the AGM,
and (c) all service contracts of the Executive Directors.
If required, the RC will seek expert advice inside and/or outside the Company on remuneration of all Directors.
The Executive Directors’ remuneration as set out in their three year service agreements effective from 8 September
2005 (unless otherwise terminated by either party giving not less than six months’ notice to the other), consist of salary,
allowances, an annual wage supplement of 1 month’s salary and an incentive bonus to be determined based on the formula
set out in the Company’s IPO Prospectus dated 31 August 2005. The said service agreements had been renewed for a further
3 years period.
The Independent Directors do not have any service agreements with the Company. Except for directors’ fees, which have to
be approved by shareholders at every annual general meeting (“AGM”), the Independent Directors do not receive any other
forms of remuneration from the Company.
The RC had recommended to the Board an amount of S$140,000 as directors’ fees payable to Independent Directors for the
year ending 31 December 2009, to be paid quarterly in arrears. These directors’ fees, to be paid quarterly in arrears for the
year ending 31 December 2009, will be tabled by the Board at the forthcoming AGM for shareholders’ approval.
Disclosure of remuneration
Breakdown of each individual director’s remuneration, in percentage terms showing the level and mix for the year ended 31
December 2008, is as follows:
Name of director Salary Bonus Director’s fees Other benefits Total

% % % % %
S$250,001 to S$500,000
Zhao Yushan 81 19 – – 100
Below S$250,000
He Maoqun 81 19 – – 100
Li Chungong 100 – – – 100
Dr Chong Weng Chiew – – 100 – 100
Ong Tiong Seng – – 100 – 100
David Zheng Fangshun – – 100 – 100
Bernard Tay Ah Kong – – 100 – 100

There was no employee of the Group who are immediate family members of a director or substantial shareholder and
whose remuneration exceeds S$150,000 during the year ended 31 December 2008.
Details of remuneration paid to the top 5 Executive Officers of the Group (who are not Directors) for the year ended 31
December 2008 are set out below:
Name of Executive Officer Salary Bonus Other benefits Total

% % % %
Below S$250,000
Leung Wai Ping Noel 100 – – 100
Miao Dezu 6 94 – 100
Cui Weishen 6 94 – 100
Zhang Jinke 6 94 – 100
Ren Zhengwei 6 94 – 100
Principle 10 : Accountability
The Board provides the shareholders with a detailed and balanced explanation and analysis of the Company’s performance,
position and prospects on a quarterly basis.
The Management provides the Board with appropriately detailed management accounts of the Group’s performance,
position and prospects on a quarterly basis.
Principle 11 : Audit Committee (“AC”)
The AC, regulated by a set of written terms of reference, comprises four members, all of whom are Independent Directors.
The current members of the AC are:
Bernard Tay Ah Kong (Chairman)

Ong Tiong Seng
Dr Chong Weng Chiew
The AC meets at least four times a year and as and when deemed appropriate to carry out its functions.
The AC has full access to and the co-operation of Management, has full discretion to invite any Director or Executive Officer
to attend its meetings and has been given adequate resources to enable it to discharge its responsibility.
The AC performs the following functions:
Reviews the annual and quarterly financial statements of the Company and the Group before submission to the
Board for adoption;
Reviews with the external auditors and internal auditors, their audit plans and audit reports;
Reviews the cooperation given by the Company’s officers to the external auditors;
Nominates and reviews the appointment or re-appointment of external auditors;
Reviews interested person transactions; and
Reviews the independence of the external auditors annually.
The Company has put in place a Whistle-Blowing Policy. The AC reviews arrangements by which staff may in confidence,
raise their concerns about possible improprieties in matters of financial reporting or other matters. The objective of the
Policy is to ensure that arrangements are in place, for the independent investigation of such concerns and for appropriate
follow-up action.

During the year ended 31 December 2008, the external auditors, Grant Thornton did not provide any non-audit service
except for quarterly reviews amounting to HK$450,000 and tax consultation services amounting to HK$20,000 (totalling
equivalent to approximately RMB420,000) as disclosed in note 8 to the financial statements. The AC is of the opinion that
there is no issue relating to provision of non-audit services that may affect the independence of the external auditors.
Annually, the AC meets with the external auditors and internal auditors without the presence of Management. The AC had
recommended the re-appointment of Grant Thornton as external auditors at the forthcoming AGM.
Principle 12 : Internal Controls

Principle 13 : Internal Audit
The Board acknowledges that it is responsible for the overall internal control framework and maintains a sound system of
internal controls to safeguard the shareholders’ investment and the Company’s assets. The internal audit function of the
Group has been outsourced to an independent Certified Public Accountants firm in FY2008. The AC reviews the adequacy
of the Group’s internal financial controls, operational and compliance controls, and risk management policies and systems
established by the management.
The AC has conducted a review of the effectiveness of the Company’s internal controls . The AC reviews the adequacy of the
internal audit function at least annually.
The Board recognizes that no internal control system will preclude all errors and irregularities, as a system is designed to
manage rather than eliminate the risk of failure to achieve business objectives, and can provide only reasonable and not
absolute assurance against material misstatement or loss.
The Board believes that, in the absence of any evidence to the contrary, the system of internal control maintained by the
Group’s management throughout the financial year ended 31 December 2008 up to the date of this report is adequate to
meet the needs of the Group in its current business environment.
The Board is responsible for maintaining a sound system of internal controls to safeguard shareholders’ interests. Internal
auditors had been appointed to review the business processes of the Group. The AC will review and approve the internal
audit plans to ensure that the internal auditors have adequately perform their functions, that the internal auditors are
adequately resourced and have appropriate standing within the Group. The internal auditors will report directly to the
Chairman of the AC on audit matters and to the Executive Chairman on administrative matters.
The internal auditors appointed by the Company to review the adequacy of the internal controls of the Group meets the
standards set by internationally recognized professional bodies.
Principle 14 : Communication with Shareholders

Principle 15 : Greater Shareholder Participation
In line with continuous disclosure obligations, the Company is committed to regular and proactive communication with its
shareholders. It is the Board’s policy that the shareholders be informed of all major developments that impact the Group.
Information is communicated to the shareholders on a timely basis through:
(a) SGXNET announcements and press releases on major developments of the Group;
(b) financial statements containing a summary of the financial information and affairs of the Group for the relevant
quarters and full year via SGXNET;
(c) annual reports that are sent to all shareholders; and
(d) notices of and explanatory notes for annual general meetings and special general meetings.

In addition, shareholders are encouraged to attend and to voice their views and seek clarification at the AGM to ensure a
greater level of shareholder participation.
The Chairmen of the AC, NC and RC and the external auditors will be present and available at the forthcoming AGM to
answer questions raised by shareholders.
Securities Transactions
The Group has adopted a set of code of conduct to provide guidance to its officers regarding dealings in the Company’s
securities, in compliance with Rule 710 of the Listing Manual of the SGX-ST.
The Group prohibits the Directors and employees to trade in the Company’s securities, during the period beginning 31 days
and 14 days before the date of the announcement of the full year or quarterly results respectively and ending on the date
of the announcement of the relevant results. Directors and employees are also advised against dealing in the Company’s
securities when they are in possession of any unpublished material price-sensitive information of the Group.
Interested Person Transactions
The Company has adopted an internal policy governing procedures for the identification, approval and monitoring of
interested person transactions. All interested person transactions are subject to review by the AC.
There were no interested person transactions for the financial year ended 31 December 2008.
Material Contracts
Saved for the Service Agreements entered with Mr Zhao Yushan, Mr He Maoqun and Mr Li Chungong (as disclosed in the
Company’s IPO Prospectus dated 31 August 2005), no material contracts were entered into between the Company, or its
subsidiaries, involving the interests of each director or controlling shareholder during the financial year as required to be
reported under Rule 1207(8).
Risk and Management
The Board currently does not have in place a risk management committee. However, the management reviews the Group’s
business and operational activities on a regular basis to identify areas of significant business risks as well as appropriate
measures to control and mitigate these risks within the Group’s policies and strategies. Any significant matters detected by
the management are reported to the Board.

FINANCIAL CONTENTS
Report of the Directors .................................................................... 25

Statements by the Directors ........................................................ 27
Report of the Independent Auditors ...................................... 28
Consolidated Income Statement .............................................. 29
Balance Sheets ...................................................................................... 30
Statements of Changes in Equity.............................................. 31
Consolidated Cash Flow Statement ........................................ 33
Notes to the Financial Statements ........................................... 35
Statistics of Shareholdings............................................................. 65
Notice of Annual General Meeting .......................................... 67
Report of the Directors
The directors present their report to the members together with the audited consolidated financial statements of the Group
for the year ended 31 December 2008.
Principal activity
The Company was incorporated in Bermuda on 26 October 2004 under the Companies Act 1981 of Bermuda as an
exempted company with limited liability. The principal activity of the Company is investment holding. The principal activities
of the Company’s subsidiaries are set out in note 16 to the financial statements.
Directors
The directors of the Company in office as at the date of this report are as follows:
Executive directors:
Mr Zhao Yushan (Chairman)

Mr He Maoqun
Independent directors:
Dr Chong Weng Chiew

Mr Ong Tiong Seng
Mr David Zheng Fangshun
Mr Bernard Tay Ah Kong
In accordance with the Company’s bye-laws, Dr. Chong Weng Chiew and Mr Bernard Tay Ah Kong shall retire by rotation
at the forthcoming Annual General Meeting. Both Dr Chong Weng Chiew and Mr Bernard Tay Ah Kong have, however, also
indicated their intention not to seek re-election.
Arrangements to enable directors to acquire shares and debentures
Neither at the end of nor at any time during FY2008 was the Company a party to any arrangement whose object is 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.
Directors’ interest in shares or debentures
According to the register of directors’ shareholdings, none of the Directors holding office for the financial year ended 31
December 2008 had any interest in the share capital or debentures of the Company, except as follows:
Number of ordinary shares of US$0.075 each of the Company

Direct interest Indirect interest
(1)
At 31.12.2008 At 31.12.2007 At 31.12.2008(1) At 31.12.2007
Mr Zhao Yushan – – 140,000,000(2) 140,000,000(2)

Mr He Maoqun – – 140,000,000(2) 140,000,000(2)
Notes:
1. The directors’ interests as at 21 January 2009 were the same as those as at 31 December 2008.
2. The 140,000,000 ordinary shares are held by Honco Union Inc. (“Honco Union”). Our Directors, Mr Zhao Yushan and Mr He Maoqun are deemed to
be interested in the 140,000 ordinary shares held by Honco Union by virtue of their interests of 48.2% and 32.6% respectively in Honco Union.

Report of the Directors
The Company has renewed its service agreements with Mr Zhao Yushan and Mr He Maoqun on 12 May 2008 for a further
period of three years unless otherwise terminated by either party giving not less than six months’ notice to the other. Apart
from the foregoing, no Director has entered into any service contract with the Company.
Share options
There is presently no option scheme on unissued shares of the Company.
Directors’ contractual interests
Except as disclosed in the financial statements, during the financial year under review, no Director has received or become
entitled to receive a benefit by reason of a contract made by the Company or a related corporation with the Director or with
a firm of which he is a member or with a company in which he has a substantial financial interest.
Audit committee, nominating committee and remuneration committee
Details of the Company’s audit committee, nominating committee and remuneration committee are set out in the Corporate
Governance Report on pages 17 to 23 of this annual report.
Auditors
The auditors, Messrs Grant Thornton, Certified Public Accountants, Hong Kong have expressed their willingness to accept
reappointment.
On behalf of the Board
Mr Zhao Yushan Mr He Maoqun

Executive Chairman Executive Director
3 March 2009

Statements by the Directors
We, Zhao Yushan and He Maoqun, being two of the directors of Reyoung Pharmaceutical Holdings Limited, do hereby state
that, in the opinion of the Directors,
(i) the accompanying balance sheets, consolidated income statement, statements of changes in equity and consolidated
cash flow statement together with notes thereto are drawn up so as to give a true and fair view of the state of affairs
of the Group and of the Company as at 31 December 2008 and the results, changes in equity and cash flows of the
Group and the changes in equity of the Company for the year ended on that date, and
(ii) at the date of this statement, there are no reasonable grounds to believe that the Company will not be able to pay its
debts as and when they fall due.
On behalf of the Board
Mr Zhao Yushan Mr He Maoqun

3 March 2009

Report of the Independent Auditors
Member of Grant Thornton International Ltd

To the members of Reyoung Pharmaceutical Holdings Limited
(incorporated in Bermuda with limited liability)
We have audited the consolidated financial statements of Reyoung Pharmaceutical Holdings Limited (the “Company”) and
its subsidiaries (the “Group”) set out on pages 29 to 64, which comprise the company and consolidated balance sheets as
at 31 December 2008, and the consolidated income statement, the company and consolidated statements of changes in
equity and the consolidated cash flow statement for the year then ended, and a summary of significant accounting policies
and other explanatory notes.
Directors’ Responsibility for the Financial Statements

The directors of the Company are responsible for the preparation and fair presentation of these financial statements in
accordance with International Financial Reporting Standards. Their opinion on these financial statements is set out on page
27.
The directors’ responsibility for the financial statements includes designing, implementing and maintaining internal control
relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether
due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are
reasonable in the circumstances.
Auditors’ Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit and to report our opinion solely
to you, as a body, in accordance with section 90 of the Bermuda Companies Act 1981, and for no other purpose. We do not
assume responsibility towards or accept liability to any other person for the contents of this report.
We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply
with ethical requirements and plan and perform the audit to obtain reasonable assurance as to whether the financial
statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statements. The procedures selected depend on the auditors’ judgement, including the assessment of
the risks of material misstatement of the financial statements, whether due to fraud or error. In making those
risk assessments, the auditors consider internal control relevant to the entity’s preparation and fair presentation
of the financial statements in order to design audit procedures that are appropriate in the circumstances, but
not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting
estimates made by the directors, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the consolidated financial statements give a true and fair view of the state of affairs of the Company and of
the Group as at 31 December 2008, and of the Group’s profit and cash flows for the year then ended in accordance with
International Financial Reporting Standards.
Grant Thornton
Certified Public Accountants
13th Floor, Gloucester Tower
The Landmark
15 Queen’s Road Central
Hong Kong
3 March 2009
Consolidated Income Statement
For the year ended 31 December 2008
Group
Notes 2008 2007
RMB’000 RMB’000
Revenue 5 814,421 723,673

Cost of sales (522,297) (419,956)
Gross profit 292,124 303,717
Other income 5 2,044 5,858
Selling and distribution costs (143,304) (137,812)

Administrative expenses (59,901) (51,414)
Other operating expenses (26,078) (15,453)
Profit from operations 8 64,885 104,896
Finance costs 7 (16,137) (13,331)
Profit before income tax 48,748 91,565
Income tax expense 9 (7,874) (15,777)
Profit for the year 40,874 75,788
Dividends 11 – 15,336
Earnings per share 12
- Basic RMB12.3 cents RMB22.7 cents
- Diluted N/A N/A

Balance Sheets
As at 31 December 2008
Group Company
Notes 2008 2007 2008 2007
RMB’000 RMB’000 RMB’000 RMB’000
ASSETS
Non-current assets
Property, plant and equipment 13 451,721 397,342 – –
Land use rights 14 63,522 65,584 – –
Intangible assets 15 6,740 7,753 – –
Investments in subsidiaries 16 – – 161,587 161,587
521,983 470,679 161,587 161,587
Current assets
Inventories 17 157,683 141,966 – –
Trade and bills receivables 18 138,053 142,409 – –
Due from a subsidiary 16 – – 153,797 153,797
Prepayments, other receivables and deposits 19 18,215 29,510 200 200
Pledged bank deposits 20 32,000 32,935 – –
Cash and bank balances 21 90,594 68,492 9,363 –
436,545 415,312 163,360 153,997
TOTAL ASSETS 958,528 885,991 324,947 315,584
EQUITY AND LIABILITIES
Equity attributable to equity holders

of the Company
Issued capital 25 206,232 206,232 206,232 206,232
Proposed final dividends 11 – 15,336 – 15,336
Reserves 276,494 235,620 43,046 50,011
Total equity 482,726 457,188 249,278 271,579
Current liabilities
Trade and bills payables 22 158,196 160,073 – –
Accrued liabilities, other payables and
deposits received 23 42,010 50,262 3,364 4,685
Interest-bearing bank borrowings 24 221,650 150,150 – –
Due to subsidiaries 16 – – 72,305 39,320
Tax payables 1,946 5,568 – –
423,802 366,053 75,669 44,005
Non-current liabilities
Interest-bearing bank borrowings 24 52,000 62,750 – –
Total liabilities 475,802 428,803 75,669 44,005
TOTAL EQUITY AND LIABILITIES 958,528 885,991 324,947 315,584
Zhao Yushan He Maoqun

3 March 2009
Statements of Changes in Equity
Group
Proposed
Issued final Share Merger Statutory Retained
capital dividends premium* reserve* reserves* profits* Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(note 26) (note 26) (note 26)
Balance as at 1 January 2007 206,232 15,003 48,576 (54,001) 35,550 145,043 396,403
Profit for the year – – – – – 75,788 75,788
Total recognised income and
expense for the year – – – – – 75,788 75,788
Transfer to reserves – – – – 18,077 (18,077) –
2006 final dividends paid – (15,003) – – – – (15,003)
Proposed final dividends 2007
(note 11) – 15,336 – – – (15,336) –
Balance as at 31 December 2007
and 1 January 2008 206,232 15,336 48,576 (54,001) 53,627 187,418 457,188
Profit for the year – – – – – 40,874 40,874
Total recognised income and
expense for the year – – – – – 40,874 40,874
Transfer to reserves – – – – 10,839 (10,839) –
2007 final dividends paid – (15,336) – – – – (15,336)
Balance as at 31 December 2008 206,232 – 48,576 (54,001) 64,466 217,453 482,726
* These reserve accounts comprise the consolidated reserves of approximately RMB276,494,000 in the consolidated balance sheet as at 31 December
2008 (2007: approximately RMB235,620,000).

Statements of Changes in Equity (Continued)

Company
Retained
Proposed profits/
Issued final Share (Accumulated
capital dividends premium** loss)** Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(note 26)
Balance as at 1 January 2007 206,232 15,003 48,576 180 269,991

Profit for the year – – – 16,591 16,591
Total recognised income and expense
for the year – – – 16,591 16,591
2006 final dividends paid – (15,003) – – (15,003)
Proposed final dividends 2007 (note 11) – 15,336 – (15,336) –
Balance as at 31 December 2007 and
1 January 2008 206,232 15,336 48,576 1,435 271,579
Loss for the year – – – (6,965) (6,965)
Total recognised income and expense
for the year – – – (6,965) (6,965)
2007 final dividends paid – (15,336) – – (15,336)
Balance as at 31 December 2008 206,232 – 48,576 (5,530) 249,278
** These reserve accounts comprise the Company’s reserves of approximately RMB43,046,000 in the Company’s balance sheet as at 31 December 2008
(2007: approximately RMB50,011,000).

Consolidated Cash Flow Statement
2008 2007
RMB’000 RMB’000
Cash flows from operating activities

Adjustments for:
Interest expense 16,137 13,331
Interest income (1,149) (921)
Loss/(Gain) on disposals of property, plant and equipment 85 (16)
Depreciation of property, plant and equipment 43,096 39,545
Amortisation of land use rights 2,062 1,328
Amortisation of intangible assets 1,013 1,013
Recognition/(Write back) of impairment loss for trade receivables 1,560 (4,112)
Impairment loss for inventories 789 1,833
Written off of other receivables 668 –
Operating profit before working capital changes 113,009 143,566
Working capital adjustments:
Increase in inventories (16,506) (953)
Decrease/(Increase) in trade and bills receivables 2,796 (16,391)
Decrease in prepayments, other receivables and deposits 7,233 12,702
Decrease in trade and bills payables (1,877) (8,323)
Decrease in accrued liabilities, other payables and deposits received (8,252) (2,309)
Cash generated from operations 96,403 128,292
Interest paid (16,137) (13,331)
Interest received 1,149 921
Income tax paid (8,102) (16,808)
Net cash generated from operating activities 73,313 99,074
Cash flows from investing activities

Purchases of property, plant and equipment (97,691) (64,102)
Purchases of land use rights – (16,972)
Proceeds from disposals of property, plant and equipment 131 60
Decrease in time deposits with original maturity of more than three
months when acquired 935 4,449
Net cash used in investing activities (96,625) (76,565)

Consolidated Cash Flow Statement (Continued)

2008 2007
RMB’000 RMB’000
Cash flows from financing activities

Dividends paid (15,336) (15,003)
New bank loans 271,000 224,850
Repayments of bank loans (210,250) (239,475)
Net cash generated from/(used in) financing activities 45,414 (29,628)
Net increase/(decrease) in cash and cash equivalents 22,102 (7,119)
Cash and cash equivalents at beginning of the year 68,492 75,611
Cash and cash equivalents at end of the year 90,594 68,492

Notes to the Financial Statements
1. CORPORATE INFORMATION
Reyoung Pharmaceutical Holdings Limited (the “Company”) was incorporated in Bermuda as an exempted company
with limited liability under the Companies Act 1981 of Bermuda on 26 October 2004. The registered office of the
Company is located at Canon’s Court, 22 Victoria Street, Hamilton, HM 12, Bermuda. The principal place of business
of the Company is located at No.6 Erlangshan Road, Yi Yuan County, Shandong, the People’s Republic of China (the
“PRC”) 256100. The Company’s shares have been listed on the Mainboard of the Singapore Exchange Securities
Trading Limited (the “SGX-ST”) since 8 September 2005.
The principal activity of the Company is investment holding. The principal activities of the Company’s subsidiaries
(together with the Company referred to as the “Group”) are set out in note 16 to the financial statements.
The Group’s operations are principally conducted in the PRC. Accordingly, the financial statements have been
presented in Renminbi (“RMB”), being the functional currency of the Company and its subsidiaries in the PRC.
The financial statements on pages 29 to 64 have been prepared in accordance with International Financial Reporting
Standards (“IFRSs”) which collective term includes all applicable individual International Financial Reporting Standards
and Interpretations approved by the International Accounting Standards Board (the “IASB”), and all applicable
individual International Accounting Standards and Interpretations as originated by the Board of the International
Accounting Standards Committee and adopted by the IASB. The financial statements also include the applicable
disclosure requirements of the Listing Manual of the SGX-ST (the “Listing Manual”).
2. ADOPTION OF NEW OR AMENDED INTERNATIONAL FINANCIAL REPORTING STANDARDS
In the current year, the Group has adopted for the first time the following new or amended IFRSs that are relevant to
and effective for the Group’s financial statements for the annual period beginning on or after 1 January 2008.
IFRIC 11 IFRS 2 – Group and Treasury Share Transactions

IAS 39 (Amended) Reclassification of Financial Assets
The new IFRSs had no material impact on how the results and financial position for the current and prior periods
have been prepared and presented. Accordingly, no prior period adjustment is required.
At the date of authorisation of these financial statements, the following new and amended IFRSs have been
published but are not yet effective, and have not been adopted early by the Group.
IAS 1 (Revised) Presentation of Financial Statements 3

IAS 1 (Revised) Presentation of Financial Statements – Amendments to IAS 32 and IAS 1
Puttable Instruments and Obligations arising on Liquidation 3
IAS 23 (Revised) Borrowing Costs 3
IAS 27 (Amended) Consolidated and Separate Financial Statements 4
IAS 28 (Amended) Investments in Associates – Consequential amendments arising from
amendments to IFRS 3 4
IAS 31 (Amended) Interests in Joint Ventures – Consequential amendments arising from
amendments to IFRS 3 4
IAS 32, IAS 39 and IFRS 7 (Revised) Financial Instruments: Presentation – Amendments relating to Puttable
Instruments and Obligations arising on Liquidation 3
IAS 39 (Amended) Eligible hedge items 4
IAS 39 (Amended) Financial Instruments: Consequential amendments arising from IAS 32
(Revised) 3
IFRS 1 First-time Adoption of IFRSs 3
IFRS 1 and IAS 27 (Amended) Amendments to IFRS 1 First-time Adoption of IFRSs and IAS 27 Consolidated
and Separate Financial Statements - Cost of an Investment in a Subsidiary,
Jointly Controlled Entity or an Associate 3


2. ADOPTION OF NEW OR AMENDED INTERNATIONAL FINANCIAL REPORTING STANDARDS (Continued)
IFRS 2 (Amended) Share-based payment – Vesting conditions and cancellations 3

IFRS 3 (Revised) Business Combinations 4
IFRS 8 Operating Segments 3
IFRIC 13 Customer Loyalty Programmes 1
IFRIC 15 Agreements for the Construction of Real Estate 3
IFRIC 16 Hedges of a Net Investment in a Foreign Operation 2
IFRIC 17 Distributions of Non-cash Assets to Owners 4
IFRIC 18 Transfer of Assets from Customers 6
Various Annual improvements to IFRS 2008 (May 2008) 5
Notes:
1
Effective for annual periods beginning on or after 1 July 2008
2
Effective for annual periods beginning on or after 1 October 2008
3
Effective for annual periods beginning on or after 1 January 2009
4
Effective for annual periods beginning on or after 1 July 2009
5
Generally effective for annual periods beginning on or after 1 January 2009 unless otherwise stated in the specific IFRS
6
Effective for transfer received on or after 1 July 2009
The directors anticipate that all of the pronouncements will be adopted in the Group’s accounting policy for the first
period beginning after the effective date of the pronouncement.
Among these new and amended IFRSs, IAS 1 (Revised) Presentation of Financial Statements is expected to
materially change the presentation of the Group’s financial statements. The amendments affect the presentation
of owner changes in equity and introduce a statement of comprehensive income. The Group will have the option
of presenting items of income and expenses and components of other comprehensive income either in a single
statement of comprehensive income with subtotals, or in two separate statements (a separate income statement
followed by a statement of comprehensive income). The amendment does not affect the financial position or results
of the Group but will give rise to additional disclosures.
In addition, IFRS 8 Operating Segments may result in new or amended disclosures. The directors are in the process of
identifying reportable operating segments as defined in IFRS 8.
The directors are currently assessing the impact of other new and amended IFRSs upon initial application. So far, the
directors have preliminarily concluded that the initial application of these IFRSs is unlikely to have a significant impact
on the Group’s results and financial position.
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of preparation
The significant accounting policies that have been adopted in the preparation of these financial statements are
summarised below. These policies have been consistently applied to all the years presented unless otherwise stated.
The financial statements have been prepared under the historical cost convention.

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Basis of preparation (Continued)
It should be noted that accounting estimates and assumptions are used in preparing the financial statements.
Although these estimates are based on the directors’ best knowledge and judgement of current events and
actions, actual results may ultimately differ from those estimates. The areas involving a higher degree of judgement
or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in
note 4.
(a) Basis of consolidation
The consolidated financial statements for the year ended 31 December 2008 comprise the financial statements
of the Company and all of its subsidiaries. The financial statements of the subsidiaries used in the preparation
of the consolidated financial statements are prepared for the same reporting date as the Company.
(b) Subsidiaries
Subsidiaries are entities over which the Group has the power to control the financial and operating policies.
The existence and effect of potential voting rights that are currently exercisable or convertible are considered
when assessing whether the Group controls another entity. Subsidiaries are fully consolidated from the date
on which control is transferred to the Group. They are excluded from consolidation from the date when
control ceases.
Inter-company transactions, balances and unrealised gains on transactions between the companies within
the Group are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of an
impairment of the asset transferred.
In the Company’s balance sheet, subsidiaries are carried at cost less any impairment loss. The results of the
subsidiaries are accounted for by the Company on the basis of dividends received and receivable at the
balance sheet date.
(c) Recognition of revenue
Revenue is recognised to the extent when it is probable that the economic benefits will flow to the Group
and when the revenue can be measured reliably. Revenue is measured at the fair value of the consideration
received, net of allowances for returns, trade discounts and value-added tax. The following specific recognition
criteria must also be met before revenue is recognised:
(i) Sales of goods - revenue is recognised when the significant risks and rewards of ownership have been
transferred to the customers, provided that the Group maintains neither managerial involvement to the
degree usually associated with ownership, nor effective control over the goods sold.
(ii) Interest income - interest income is recognised as interest accrues (using the effective interest method)
unless collectibility is in doubt.
(iii) Dividend income - dividend income is recognised when the Group’s right to receive payment is
established.


(d) Property, plant and equipment
Property, plant and equipment, other than construction in progress, are stated at cost less accumulated
depreciation and any accumulated impairment losses. The cost of an asset comprises its purchase price and
any directly attributable costs of bringing the asset to the working condition and location for its intended use.
Expenditure incurred after property, plant and equipment have been put into operation, such as repairs and
maintenance, is normally charged to the income statement in the period in which it is incurred. In situations
where it can be clearly demonstrated that the expenditure has resulted in an increase in the future economic
benefits expected to be obtained from the use of the property, plant and equipment, and the expenditure of
the item can be measured reliably, the expenditure is capitalised as an addition to the carrying amount that
asset or as a separate asset, as appropriate.
Depreciation is calculated on the straight-line basis to write off the cost of property, plant and equipment, less
any estimated residual values, over the following estimated useful lives:
Leasehold buildings The shorter of the lease terms and 48 years

Plant and machinery 10 years
Furniture, fixtures and office equipment 5 years
Motor vehicles 5 years
An item of property, plant and equipment is derecognised upon disposal or when no future economic
benefits are expected from its use. Any gain or loss arising on derecognition of an asset (calculated as the
difference between the net disposal proceeds and the carrying amount of the asset) is recognised in the
income statement.
Construction in progress, which represents buildings under construction, and plant and machinery pending
installation, is stated at cost less any impairment losses. Cost comprises direct costs incurred during the
periods of construction, installation and testing. No depreciation is provided on construction in progress.
Construction in progress is reclassified to the appropriate category of property, plant and equipment and
depreciation commences when the construction in progress is completed and ready for use.
The assets’ estimated residual values and useful lives are reviewed, and adjusted if appropriate, at each financial
year end.
(e) Land use rights
Land use rights represent up-front payments to acquire long term interests in the usage of land in the PRC.
They are stated at cost less accumulated amortisation and any accumulated impairment losses. Amortisation
is charged to the income statement on the straight-line basis over the period of the leases which ranged from
10 to 50 years.
(f ) Intangible assets
Intangible assets are stated at cost less accumulated amortisation and any accumulated impairment losses.

(f ) Intangible assets (Continued)
The useful lives of intangible assets are assessed to be either finite or indefinite. Intangible assets with finite
lives are amortised over the expected economic useful life and assessed for impairment whenever there is an
indication that the intangible asset may be impaired. The amortisation period and method for an intangible
asset with a finite useful life are reviewed at least at each financial year end. Changes in the expected
economic useful life or the expected pattern of consumption of future economic benefits embodied in the
asset is accounted for by changing the amortisation period or method, as appropriate, and treated as changes
in accounting estimates. The amortisation expense on intangible assets with finite lives is recognised in the
income statement in the expense category consistent with the function of the intangible assets.
Intangible assets with indefinite useful lives are tested for impairment annually either individually or at the
cash generating unit level. Such intangible assets are not amortised. The expected economic useful life of
an intangible asset with an indefinite life is reviewed annually to determine whether indefinite life assessment
continues to be supportable. If not, the change in the economic useful life assessment from indefinite to
finite is made on a prospective basis.
Research and development costs
All research costs are charged to the income statement as incurred.
An intangible asset arising from development expenditure incurred on projects to develop new products is
recognised only when the projects are clearly defined; the expenditure is separately identifiable and can be
measured reliably; it is technically feasible to complete the intangible asset so that it will be available for use or
sale; the asset will generate future economic benefits; the Group has the intention to complete and the ability
to use or sell the asset; and resources are available to complete the asset. Development expenditure which
does not meet these criteria is expensed to the income statement when incurred.
During the period of development, the intangible asset is tested for impairment annually. Following the
initial recognition of the development expenditure, the cost model is applied requiring the asset to be carried
at cost less accumulated amortisation and any accumulated impairment losses. Amortisation of the asset
begins when development is complete and the asset is available for use. It is amortised over the period of its
expected economic useful life.
Trademark and patents
The trademark and patents are amortised on the straight-line basis over their expected economic useful life of
10 years.
Gains or losses arising from derecognition of an intangible asset are measured as the difference between the
net disposal proceeds and the carrying amount of the asset and are recognised in the income statement
when the asset is derecognised.


(g) Impairment of non-financial assets
An assessment is made at each balance sheet date of whether there is any indication of impairment of
the Group’s property, plant and equipment, land use rights, intangible assets, the Company’s investments
in subsidiaries and other non-financial assets or whether there is any indication that an impairment loss
previously recognised for an asset in prior years may no longer exist or may have decreased. If any such
indication exists or when annual impairment testing for an asset is required, the asset’s recoverable amount
is estimated. An asset’s recoverable amount is calculated as the higher of the asset’s value in use and its
fair value less costs to sell and is determined for an individual asset. Where an asset does not generate cash
inflows that are largely independent of those from other assets or groups of assets, the recoverable amount is
determined for the smallest group of assets that generate cash inflows independently (i.e. a cash-generating
unit). As a result, some assets are tested individually and some are tested at cash-generated unit level for
impairment. In assessing value in use, the estimated future cash flows are discounted to their present value
using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks
specific to the asset. In determining fair value less costs to sell, an appropriate valuation model is used.
An impairment loss is recognised only if the carrying amount of an asset exceeds its recoverable amount. An
impairment loss is charged to the income statement in the expense category consistent with the function of
the impaired assets in the period in which it arises.
A previously recognised impairment loss is reversed only if there has been a change in the estimates used to
determine the recoverable amount of an asset since the last impairment loss was recognised, however not to
an amount higher than the carrying amount that would have been determined, net of amortisation, had no
impairment loss been recognised for the asset in prior years.
A reversal of an impairment loss is credited to the income statement in the period in which it arises.
(h) Financial assets
The Group’s financial assets mainly include trade and bills receivables, other receivables and deposits, pledged
bank deposits, and cash and bank balances.
These financial assets are non-derivative financial assets with fixed or determinable payments that are not
quoted in an active market and are classified as loans and receivables under IAS 39. These financial assets
are measured at initial recognition at fair value plus any directly attributable transaction costs, and are
subsequently measured at amortised cost using the effective interest method, less any allowance for
impairment.
Gain or loss is recognised in the income statement when these financial assets are derecognised.
The Group assesses at each balance sheet date whether a financial asset or group of financial assets is
impaired. Appropriate allowance for estimated irrecoverable amounts is recognised in the income statement
when there is objective evidence that the asset is impaired. The allowance recognised is measured as the
difference between the asset’s carrying amount and the present value of estimated future cash flows
(excluding future expected credit losses that have not been incurred) discounted at the effective interest rate
computed at initial recognition. The impairment loss is recognised in the income statement. The carrying
amount of the financial assets is reduced through the use of an allowance account, and the amount of the
loss is recognised in the income statement within “other operating expenses” in the period in which the
impairment occurs.

(h) Financial assets (Continued)
If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related
objectively to an event occurring after the impairment was recognised, the previously recognised impairment
loss is reversed. Any subsequent reversal of an impairment loss is recognised in the income statement to the
extent that the carrying amount of the asset does not exceed its amortised cost at the reversal date.
(i) Inventories
Inventories are stated at the lower of cost and net realisable value. Cost comprises direct materials computed
using weighted average method and, where applicable, direct labour and those overheads that have been
incurred in bringing the inventories to their present location and condition. Net realisable value is calculated
as the estimated selling price in the ordinary course of business less all further costs of completion and the
estimated costs necessary to make the sale.
(j) Financial liabilities
The Group’s financial liabilities mainly include trade and bills payables, other payables, accrued liabilities and
interest-bearing bank borrowings which are recognised when, and only when the Group becomes a party
to the contractual provisions of the financial instruments. Financial liabilities are initially measured at fair
value of consideration received less any directly attributable transaction costs, and subsequently measured at
amortised cost using the effective interest method. Gain or loss is recognised in the income statement when
the financial liabilities are derecognised. A financial liability is derecognised when the obligation under the
liability is discharged or cancelled or expensed.
Borrowing costs are recognised as expenses when incurred.
(k) Income taxes
Income tax for the year comprises current and deferred tax.
Current tax is the expected tax payable on the taxable income for the year using tax rates enacted or
substantively enacted at the balance sheet date, and any adjustment to tax payable in respect of previous
years.
Corporate income tax is provided at rates applicable to the companies within the Group on income for
financial reporting purpose, adjusted for income and expense items which are not assessable or deductible
for income tax purposes.
Deferred tax is the tax expected to be payable or recoverable on temporary differences between the carrying
amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the
computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax
liabilities are generally recognised for all taxable temporary differences. Deferred tax assets are recognised
for all deductible temporary differences, the carry forward of unused tax credits and unused tax losses to the
extent that it is probable that taxable profits will be available against which deductible temporary differences,
the carry forward of unused tax credits and unused tax losses can be utilised. Such assets and liabilities are
not recognised if the temporary difference arises from the initial recognition of other assets and liabilities in a
transaction that affects neither the taxable profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at the balance sheet date and reduced to the extent
that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be
utilised. Unrecognised deferred tax assets are reassessed at each balance sheet date and are recognised to the
extent that it has become probable that future taxable profit will allow the deferred tax assets to be recovered.


(k) Income taxes (Continued)
Deferred tax assets and liabilities are not discounted. Deferred tax is calculated at the tax rates that are
expected to apply in the year when the asset is realised or the liability is settled, based on tax rates that have
been enacted or substantively enacted at the balance sheet date. Deferred tax is charged or credited to the
income statement, except when it relates to items charged or credited directly to equity, in which case the
deferred tax is also dealt with in equity. Deferred tax assets and liabilities are not offset unless there is a legally
enforceable right which exists to set off the current tax assets and liabilities and the deferred taxes relate to
the same taxable entity and the same taxation authority.
(l) Cash and cash equivalents
For the purpose of the cash flow statement, cash and cash equivalents consist of cash on hand and in banks,
demand deposits, and short term highly liquid investments which are readily convertible into known amounts
of cash and are subject to an insignificant risk of changes in value, and have a short maturity of generally
within three months when acquired, less bank overdrafts which are repayable in demand and form an integral
part of the Group’s cash management.
For the purpose of the balance sheet classification, cash and bank balances comprise cash on hand and
demand deposits repayable on demand with any banks or other financial institutions.
(m) Share capital
Ordinary shares are classified as equity. Share capital is determined using the nominal value of shares that
have been issued. Any transaction costs associated with the issuing of shares are deducted from equity (net
of any related income tax benefit) to the extent that they are incremental costs directly attributable to the
equity transaction.
(n) Employee benefits
Retirement benefit scheme
Pursuant to the relevant regulations of the PRC government, the Group participates in a local municipal
government retirement benefit scheme (the “Scheme”), whereby the subsidiaries of the Company in the
PRC are required to contribute a certain percentage of the basic salaries of its employees to the Scheme to
fund their retirement benefits. The local municipal government undertakes to assume the retirement benefit
obligations of all existing and future retired employees of the subsidiaries of the Company in the PRC. The
only obligation of the Group with respect to the Scheme is to pay the ongoing required contributions under
the Scheme. Contributions under the Scheme are charged to the income statement as incurred. There are no
provisions under the Scheme whereby forfeited contributions may be used to reduce future contributions.
Employee leave entitlement
Employee entitlements to annual leave are recognised as a liability when they accrue to employees. The
estimated liability for leave is recognised for services rendered by employees up to the balance sheet date.
(o) Segment reporting
In accordance with the Group’s internal financial reporting, the Group has determined that business segments
be presented as the primary segment reporting format.

(o) Segment reporting (Continued)
Unallocated costs represent corporate expenses. Segment assets consist primarily of property, plant and
equipment, land use rights, intangible assets, inventories, receivables and operating cash. Segment liabilities
comprise operating liabilities.
Capital expenditure comprises additions to property, plant and equipment, land use rights and intangible
assets including additions resulting from acquisitions of subsidiaries.
In respect of geographical segment reporting, sales are based on the country in which the customers are
located and total assets and capital expenditure are where the assets are located.
(p) Operating leases
An arrangement, comprising a transaction or a series of transactions, is or contains a lease if the Group

determines that the arrangement conveys a right to use a specific asset or assets for an agreed period of time
in return for a payment or a series of payments. Such a determination is made based on an evaluation of the
substance of the arrangement and is regardless of whether the arrangement takes the legal form of a lease.
Leases which do not transfer to the leasee substantially all the risks and rewards of ownership are classified as
operating leases.
Operating lease payments are recognised as an expense on a straight-line basis over the lease term in the
income statement. Affiliated costs, such as maintenance and insurance, are expensed as incurred.
(q) Foreign currencies
Foreign currency transactions are measured in the respective functional currencies of the Company and the
subsidiaries and are recorded on initial recognition in the functional currencies at the applicable exchange
rates ruling at the transactions dates. Monetary assets and liabilities denominated in foreign currencies at the
balance sheet date are translated at the applicable exchange rates ruling at that date. Non-monetary items
that are measured in terms of historical cost in a foreign currency are translated using the exchange rates as at
the dates of the initial transactions. Exchange differences are dealt with in the income statement.
In the consolidated financial statements, all individual financial statements of subsidiaries, originally presented
in a currency different from the Group’s presentation currency, have been converted into RMB. Assets and
liabilities have been translated into RMB at the closing rate at the balance sheet date. Income and expenses
have been converted into RMB at the exchange rates ruling at the transaction dates, or at the average rates
over the reporting period provided that the exchange rates do not fluctuate significantly. Any differences
arising from this procedure have been dealt with in the currency translation reserve in equity.
(r) Related parties
A party is considered to be related to the Group if:
(i) directly, or indirectly through one or more intermediaries, the party (1) controls, is controlled, or is
under common control with, the Company/Group; (2) has an interest in the Company that gives it
significant influence over the Company/Group; or (3) has joint control over the Company/Group;
(ii) the party is an associate;
(iii) the party is a jointly-controlled entity;


(r) Related parties (Continued)
(iv) the party is a member of the key management personnel of the Company or its parent;
(v) the party is a close member of the family of any individual referred to in (i) or (iv); or
(vi) the party is an entity that is controlled, jointly controlled or significantly influenced by or for which
significant voting power in such entity resides with, directly or indirectly, any individual referred to in
(iv) or (v); or
(vii) the party is a post-employment benefit plan for the benefit of employees of the Company/Group, or of
any entity that is a related party of the Company/Group.
(s) Provisions
Provisions are recognised when present obligations will probably lead to an outflow of economic resources
from the Group which can be estimated reliably. Timing or amount of the outflow may still be uncertain. A
present obligation arises from the presence of a legal or constructive commitment that has resulted from past
events.
Provisions are measured at the estimated expenditure required to settle the present obligation, based on the
most reliable evidence available at the balance sheet date, including the risks and uncertainties associated
with the present obligation. Any reimbursement expected to be received in the course of settlement of
the present obligation is recognised as a separate asset, not exceeding the amount of the related provision.
Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement
is determined by considering the class of obligations as a whole. In addition, long term provisions are
discounted to their present values, where time value of money is material.
All provisions are reviewed at the balance sheet date and adjusted to reflect the current best estimates.
In those cases where the possible outflow of economic resources as a result of present obligations
is considered impossible or remote, or the amount to be provided for cannot be measured reliably,
no contingent liability is recognised in the balance sheet, unless assumed in the course of a business
combination.
4. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
Estimates, assumptions concerning the future and judgements are made in the preparation of the financial
statements. They affect the application of the Group’s accounting policies, reported amounts of assets, liabilities,
income and expenses and disclosures made. The accounting estimates made may not equal to the actual results.
They are continually evaluated and are based on experiences and other factors, including expectations of future
events that are believed to be reasonable under the circumstances.
The key estimates and assumptions that have a significant risk of causing a material adjustment to the carrying
amounts of assets and liabilities within the next financial year are discussed below.
(i) Net realisable value of inventories
Net realisable value of inventories is the estimated selling price in the ordinary course of business, less all
further costs of completion and the estimated costs necessary to make the sale. These estimates are based
on the current market condition and the historical experience of selling products of similar nature. They could
be changed significantly as a result of competitors’ actions in response to changes in market condition. The
Group’s management will reassess the estimations at the balance sheet date of the next financial year.

4. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (Continued)
(ii) Impairment of trade and bills receivables
The Group’s management assesses the collectibility of trade and bills receivables on a regular basis. This
estimate is based on the credit-worthiness and repayment history of its customers and the current market
condition. Management will reassess the impairment loss at the balance sheet date of the next financial year.
(iii) Depreciation and amortisation
The Group depreciates the property, plant and equipment and amortises the intangible assets in accordance
with the accounting policies stated in note 3(d) and 3(f ) respectively. The estimated useful lives reflect the
directors’ estimates of the periods that the Group intends to derive future economic benefits from use of these
assets.
(iv) Income taxes
The Group is subject to income taxes in the PRC. Significant judgement is required in determining the
provision for income taxes. There are many transactions and calculations for which the ultimate tax
determination is uncertain during the ordinary course of business. The Group recognises liabilities for
anticipated tax based on estimates of whether additional taxes will be due. Where the final tax outcome
of these matters is different from the amounts that were initially recorded, such differences will impact the
income tax and deferred tax provision in the period in which such determination is made.
5. REVENUE AND OTHER INCOME
Revenue of the Group represents the net invoiced value of goods sold, net of allowances for returns, trade discounts
and value-added tax.
An analysis of the Group’s revenue and other income is as follows:
2008 2007
RMB’000 RMB’000
Revenue
Sales of goods 814,421 723,673
Other income
Bank interest income 1,149 921
Write back of impairment loss for trade receivables – 4,112
Gain on disposals of property, plant and equipment – 16
Others 895 809
2,044 5,858


6. SEGMENT INFORMATION
Primary reporting format - business segments

The Group is organised into two main business segments:
- Manufacturing and sales of pharmaceutical products

- Manufacturing and sales of personal hygiene products
An analysis by principal activity of contribution to results is as follows:
2008
Manufacturing
Manufacturing and sales
and sales of of personal
pharmaceutical hygiene
products products Others Total
RMB’000 RMB’000 RMB’000 RMB’000
Segment revenue
Sales to external customers 732,732 81,689 – 814,421
Segment results 65,747 4,391 – 70,138
Other income 2,044

Unallocated corporate expenses (7,297)
Profit from operations 64,885
Finance costs (16,137)
Profit before income tax 48,748
Income tax expense (7,874)
Profit for the year 40,874
Segment assets 766,876 181,949 9,703 958,528
Segment liabilities 449,805 22,721 3,276 475,802
Other segment information:

Capital expenditure 93,702 3,989 – 97,691
Depreciation 34,541 8,555 – 43,096
Amortisation charge 2,661 414 – 3,075
Other non-cash expenses 645 2,372 – 3,017

6. SEGMENT INFORMATION (Continued)
Primary reporting format - business segments (Continued)
2007
Manufacturing
Manufacturing and sales
and sales of of personal
pharmaceutical hygiene
products products Others Total
RMB’000 RMB’000 RMB’000 RMB’000
Segment revenue
Sales to external customers 579,465 144,208 – 723,673
Segment results 83,931 24,472 – 108,403
Other income 5,858

Unallocated corporate expenses (9,365)
Profit from operations 104,896
Finance costs (13,331)
Profit before income tax 91,565
Income tax expense (15,777)
Profit for the year 75,788
Segment assets 690,237 195,385 369 885,991
Segment liabilities 383,412 40,794 4,597 428,803
Other segment information:

Capital expenditure 104,460 3,038 – 107,498
Depreciation 31,192 8,353 – 39,545
Amortisation charge 2,040 301 – 2,341
Other non-cash expenses 261 1,572 – 1,833
Other non-cash income 7,950 (3,838) – 4,112
Secondary reporting format - geographical segments
No geographical segment information is presented as all of the Group’s revenue, expenses, results, assets and
liabilities are located in the PRC, which is considered as one geographical location with similar risks and returns.
7. FINANCE COSTS
Group
2008 2007
RMB’000 RMB’000
Interest charges on:

Bank loans wholly repayable within five years 16,137 13,331


8. PROFIT FROM OPERATIONS
Profit from operations is arrived at after charging:
Group
2008 2007
RMB’000 RMB’000
Cost of inventories recognised as an expense 416,971 343,146

Amortisation of land use rights* 2,062 1,328
Amortisation of intangible assets 1,013 1,013
Depreciation of property, plant and equipment** 43,096 39,545
Minimum lease payment under operating leases for leasehold buildings 46 91
Non-audit fee 420 450
Loss on disposals of property, plant and equipment 85 –
Staff costs (including directors’ emoluments (note 10)) 68,321 51,893

Less: retirement scheme contribution (9,050) (3,989)
amount included in research and development costs (230) (224)
Staff costs charged to income statement 59,041 47,680
Impairment loss for trade receivables*** 1,560 –

Impairment loss for inventories*** 789 1,833
Research and development costs 21,521 13,098
* Amortisation of land use rights of approximately RMB815,000 (2007: approximately RMB1,023,000) and approximately RMB1,247,000 (2007:
approximately RMB305,000) has been charged to cost of sales and administrative expenses, respectively for the year ended 31 December
2008.
** Depreciation charge of approximately RMB35,906,000 (2007: approximately RMB32,532,000) and approximately RMB7,190,000 (2007:
approximately RMB7,013,000) has been charged to cost of sales and administrative expenses, respectively for the year ended 31 December
2008.
*** Impairment losses for trade receivables and inventories have been charged to other operating expenses for the year ended 31 December
2008.
9. INCOME TAX EXPENSE
Group
2008 2007
RMB’000 RMB’000
Current year provision:

PRC income tax 7,874 15,777
PRC income tax is provided at the rates applicable to the subsidiaries in the PRC on their income for statutory
reporting purpose, adjusted for income and expense items which are not assessable or deductible for income tax
purposes based on the existing PRC income tax regulations, practices and interpretations thereof.

9. INCOME TAX EXPENSE (Continued)
Pursuant to the restructuring exercise (the “Restructuring Exercise”) the details of which were stated in the Company’s
prospectus dated 31 August 2005, the Company’s wholly owned subsidiaries, Reyoung Pharmaceutical Co., Limited
(formerly known as Shandong Reyoung Pharmaceutical Co., Limited) (“Reyoung”) and Shandong Yimoo Women
Necessities Co., Limited (“Shandong Yimoo”) became wholly foreign-owned enterprises (“WOFEs”) in the PRC. In
accordance with the various approval documents issued by the State Tax Bureau and the Local Tax Bureau of the
PRC, Reyoung and Shandong Yimoo, as WOFEs in the PRC, are entitled to exemption from the PRC state and local
corporate income taxes for the first two profitable financial years and thereafter are entitled to a 50% relief from the
state corporate income tax and full exemption from local corporate income tax of the PRC for the following three
financial years (the “Tax Holiday”).
Pursuant to the Restructuring Exercise, Shanghai Yimoo Women Necessities Co., Limited (“Shanghai Yimoo”) became
a sino-foreign cooperative enterprise in the PRC. In accordance with the various approval documents issued by the
State Tax Bureau and Local Tax Bureau of the PRC, as a sino-foreign cooperative enterprise in the PRC, Shanghai Yimoo
is entitled to the Tax Holiday.
Pursuant to the PRC Enterprise Income Tax Law passed by the Tenth National People’s Congress on 16 March 2007,
the new enterprise income tax rate for domestic and foreign enterprises is unified at 25% and has been effective
from 1 January 2008. According to the implementation rules dated 26 December 2007 issued by State Council, the
foreign enterprises are entitled to tax holidays under the old regime, if the foreign enterprises obtained their business
licenses on or before 16 March 2007.
The taxable profits of Reyoung and Shandong Yimoo are subject to state corporate income tax at 15% (after the
50% relief from the normal rate of 30%) for the years ended 31 December 2006 and 2007, and are subject to state
corporate income tax at 12.5% (after the 50% relief from the normal rate of 25%) for the year ended 31 December
2008.
No corporate income tax has been provided for Shanghai Yimoo as it did not derive any assessable profits during the
years ended 31 December 2007 and 2008.
After the expiry of the Tax Holiday of Reyoung and Shandong Yimoo in the financial year ended 31 December 2008
and of Shanghai Yimoo in the financial year ending 31 December 2009, these three subsidiaries in the PRC will be
subject to income tax at the rate of 25% under the new Enterprise Income Tax Law of the PRC.
Tax has not been provided by the Company as the Company did not derive any assessable profits during the year
(2007: Nil).
The Group has not recognised deferred tax assets of approximately RMB1,097,000 (2007: approximately RMB344,000)
arising mainly from the estimated tax losses of approximately RMB8,775,000 (2007: approximately RMB2,748,000) of
Shanghai Yimoo. The deferred tax assets have not been recognised as it is uncertain whether future taxable profit of
Shanghai Yimoo will be available for utilising the tax losses.
As at 31 December 2008, deferred tax liabilities amounted to approximately RMB5,481,000 (2007: Nil) in respect of the
aggregate amount of temporary differences associated with the undistributed earnings of Reyoung and Shandong
Yimoo have not been recognised. No deferred tax liabilities have been recognised in respect of these differences
because the Group is in a position to control the dividend policies of these subsidiaries and it is probable that such
differences will not reverse in the foreseeable future.


9. INCOME TAX EXPENSE (Continued)
A reconciliation of the income tax expense and accounting profit at applicable tax rates is presented below:
Group
2008 2007
RMB’000 RMB’000
Tax on profit before income tax, calculated at the applicable rate to

profits in the tax jurisdiction concerned 12,187 30,216
Non-taxable income (259) (1,220)
Non-deductible expenses 2,513 4,676
Tax Holiday of the subsidiaries in the PRC (7,005) (18,323)
Others 438 428
7,874 15,777
10. DIRECTORS’ REMUNERATION
The remuneration of the directors of the Company analysed into the following bands is disclosed in compliance with
paragraph 1207.11 of Chapter 12 of the Listing Manual of the SGX-ST:
Executive Non-executive
directors directors Total
Below S$250,000 (equivalent to RMB1,230,000) 2 4 6

S$250,000 to below S$500,000 (equivalent to
RMB1,230,000 to RMB2,460,000) 1 – 1
3 4 7
Executive Non-executive
directors directors Total
Below S$250,000 (equivalent to RMB1,262,000) 2 4 6

S$250,000 to below S$500,000 (equivalent to
RMB1,262,000 to RMB2,524,000) 1 – 1
3 4 7

11. DIVIDENDS
Group Company
2008 2007 2008 2007
RMB’000 RMB’000 RMB’000 RMB’000
Proposed final dividends

- RMBNil (2007: RMB0.046) per ordinary share – 15,336 – 15,336
The board of directors did not recommend any payment of dividends during the year. For the year ended 31
December 2007, final dividends of RMB0.046 per ordinary share, amounting to approximately RMB15,336,000, were
proposed and submitted for formal approval at the last Annual General Meeting of the Company held on 30 April
2008. As such, the final dividends of 2007 were not recognised as a liability as at 31 December 2007 but reflected as
an appropriation of retained profits for the year ended 31 December 2007. These dividends were approved and paid
during the year ended 31 December 2008.
12. EARNINGS PER SHARE
The calculation of basic earnings per share is based on the profit attributable to equity holders of the Company of
approximately RMB40,874,000 (2007: approximately RMB75,788,000) and on the weighted average of 333,400,000
(2007: 333,400,000) ordinary shares in issue during the year.
Diluted earnings per share for the years ended 31 December 2007 and 2008 was not presented as there is no dilutive
potential ordinary share in existence during both years.


13. PROPERTY, PLANT AND EQUIPMENT
Group
Furniture,
fixtures
Leasehold Plant and and office Motor Construction
buildings machinery equipment vehicles in progress Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
At 1 January 2007
Gross carrying amount 196,617 241,532 22,130 7,100 26,373 493,752
Accumulated depreciation (32,413) (69,400) (14,632) (4,478) – (120,923)
Net carrying amount 164,204 172,132 7,498 2,622 26,373 372,829
For the year ended

31 December 2007
Opening net carrying amount 164,204 172,132 7,498 2,622 26,373 372,829
Additions – 8,993 1,813 1,399 51,897 64,102
Disposals – – (33) (11) – (44)
Transfer in/(out) 28,758 9,695 – – (38,453) –
Depreciation (10,967) (24,130) (3,182) (1,266) – (39,545)
Closing net carrying amount 181,995 166,690 6,096 2,744 39,817 397,342
At 31 December 2007
For the year ended

31 December 2008
Opening net carrying amount 181,995 166,690 6,096 2,744 39,817 397,342
Additions 608 5,730 4,287 3,224 83,842 97,691
Disposals (111) – (1) (104) – (216)
Transfer in/(out) 16,709 3,988 8,110 – (28,807) –
Depreciation (12,222) (26,174) (3,197) (1,503) – (43,096)
Closing net carrying amount 186,979 150,234 15,295 4,361 94,852 451,721
At 31 December 2008
The Group’s leasehold buildings are situated in the PRC and are held under short-term to medium-term leases.

13. PROPERTY, PLANT AND EQUIPMENT (Continued)
As at 31 December 2008, certain of the Group’s leasehold buildings with a net carrying amount of approximately
RMB58,127,000 (2007: approximately RMB109,171,000), plant and machinery with a net carrying amount of
approximately RMB128,014,000 (2007: approximately RMB41,067,000) and furniture, fixtures and office equipment
with a net carrying amount of approximately RMB866,000 (2007: RMB1,306,000) have been pledged to the banks to
secure the bank loans granted to the Group (note 24).
14. LAND USE RIGHTS
Group
The Group’s interests in land use rights represent up-front payments to acquire long term interests in the usage of
land in the PRC.
2008 2007
RMB’000 RMB’000
At 1 January
Gross carrying amount 69,426 26,030
Accumulated amortisation (3,842) (2,514)
Net carrying amount 65,584 23,516
For the year ended 31 December

Opening net carrying amount 65,584 23,516
Additions – 43,396
Amortisation (2,062) (1,328)
Closing net carrying amount 63,522 65,584
At 31 December
Gross carrying amount 69,426 69,426
Accumulated amortisation (5,904) (3,842)
Net carrying amount 63,522 65,584
As at 31 December 2008, certain of the Group’s land use rights with a net carrying amount of approximately
RMB42,888,000 (2007: approximately RMB57,099,000) have been pledged to the banks to secure the bank loans
granted to the Group (note 24).


15. INTANGIBLE ASSETS
Group
Trademark Patents Total

RMB’000 RMB’000 RMB’000
At 1 January 2007
Gross carrying amount 197 9,815 10,012
Accumulated amortisation (61) (1,185) (1,246)
Net carrying amount 136 8,630 8,766

Opening net carrying amount 136 8,630 8,766
Amortisation charges (28) (985) (1,013)
Closing net carrying amount 108 7,645 7,753
At 31 December 2007

Opening net carrying amount 108 7,645 7,753
Amortisation charges (29) (984) (1,013)
Closing net carrying amount 79 6,661 6,740
At 31 December 2008
16. INVESTMENTS IN SUBSIDIARIES
2008 2007
RMB’000 RMB’000
Unlisted shares, at cost 161,587 161,587
The balances with subsidiaries are unsecured, non-interest bearing and are repayable on demand.

16. INVESTMENTS IN SUBSIDIARIES (Continued)
Particulars of the subsidiaries at 31 December 2008 are as follows:
Nominal value
of issued Percentage
Place of ordinary share of equity
incorporation/ capital/paid- attributable
establishment up registered to the Company
Name and operations capital Direct Indirect Principal activities
Directly held:
Cofan Wealth Corporation BVI US$1 100% – Investment holding
Indirectly held:
Wealthy Summit BVI US$1 – 100% Investment holding
Corporation
Triumphant Empire Inc. BVI US$1 – 100% Investment holding
Wise Achievement Inc. BVI US$1 – 100% Investment holding
Ways (HK) Investment HK HK$1 – 100% Inactive

Limited
Reyoung PRC RMB78,577,386 – 100% Manufacturing and sales of

pharmaceutical products
Shandong Yimoo PRC RMB34,261,040 – 100% Manufacturing and sales of

personal hygiene products
Shanghai Yimoo PRC RMB10,000,000 – 100% Manufacturing and sales of

personal hygiene products
The financial statements of the above subsidiaries for the year ended 31 December 2008 are audited by Grant
Thornton, Hong Kong for the purpose of incorporation into the Group’s consolidated financial statements.
17. INVENTORIES
Group
2008 2007
RMB’000 RMB’000
Raw materials 58,362 54,722

Work-in-progress 36,693 30,932
Finished goods 65,250 58,145
160,305 143,799
Less: Allowance for impairment (2,622) (1,833)
157,683 141,966


18. TRADE AND BILLS RECEIVABLES
Trade and bills receivables are non-interest bearing and are generally on 60 to 180 days’ credit terms. They are
recognised at their original invoice amounts which represent their fair values on initial recognition. Ageing analysis
of trade and bills receivables, net of allowance, as at the balance sheet date, based on the date of recognition of the
sale, is as follows:
Group
2008 2007
RMB’000 RMB’000
Trade receivables
Under 90 days 104,883 101,195
91 – 180 days 32,922 34,249
181 – 365 days 4,315 3,451
Over 365 days 3,811 2,968
145,931 141,863
Less: Allowance for impairment (7,878) (6,318)
138,053 135,545
Bills receivables – 6,864
138,053 142,409
As at 31 December 2008, trade receivables of the Group amounting to approximately RMB145,931,000 (2007: Nil)
have been pledged to the banks to secure the bank loans granted to the Group (note 24).
The movement in the allowance for impairment of trade receivables is as follows:
Group
2008 2007
RMB’000 RMB’000
At 1 January 6,318 10,430

Recognition/(Write back) of impairment loss 1,560 (4,112)
At 31 December 7,878 6,318
At each balance sheet date, the Group reviews receivables for evidence of impairment on an individual basis. As
at 31 December 2008, the Group has determined trade receivables of approximately RMB7,878,000 as individually
impaired (2007: approximately RMB6,318,000). Based on this assessment, impairment loss of RMB1,560,000 has been
recognised during the year.
During the year ended 31 December 2007, impairment loss for trade receivables in Reyoung amounting to
approximately RMB4,112,000 recognised in previous years was written back as the customers had repaid the overdue
balances.
The Group did not hold any collateral as security or other credit enhancements over the trade receivables.

18. TRADE AND BILLS RECEIVABLES (Continued)
Ageing analysis of trade and bills receivables that are neither individually nor collectively considered to be impaired
are as follows:
Group
2008 2007
RMB’000 RMB’000
Neither past due nor impaired 137,805 142,308

Past due of less than 6 months but not impaired 248 101
138,053 142,409
Trade and bills receivables that were neither past due nor impaired related to a wide range of customers for whom
there were no recent history of default.
Trade and bills receivables that were past due but not impaired related to a number of diversified customers that had
a good track record of credit with the Group. Based on past credit history, management believes that no impairment
allowance is necessary in respect of these balances as there has not been a significant change in credit quality and
the balances are still considered to be fully recoverable. The Group did not hold any collateral in respect of trade
receivables that were past due but not impaired.
19. PREPAYMENTS, OTHER RECEIVABLES AND DEPOSITS
Group Company
2008 2007 2008 2007
RMB’000 RMB’000 RMB’000 RMB’000
Prepayments 3,157 4,152 – –

Advances to sales representatives 9,473 12,987 – –
Other receivables 3,394 10,419 200 200
Deposits 2,191 1,952 – –
18,215 29,510 200 200
20. PLEDGED BANK DEPOSITS
The Group’s bills payables amounting to approximately RMB53,000,000 (2007: approximately RMB41,716,000) are
secured by the pledge of the Group’s time deposits of approximately RMB32,000,000 as at 31 December 2008 (2007:
approximately RMB32,935,000) (note 22). The effective interest rate of the pledged bank deposits is 1.98% per annum
(2007: 3.78% per annum). The pledged bank deposits have a maturity of 180 days.
21. CASH AND BANK BALANCES
As at 31 December 2008, the Group had cash and bank balances denominated in RMB amounting to approximately
RMB80,817,000 (2007: approximately RMB68,324,000), which were deposited with banks in the PRC. RMB is not freely
convertible into foreign currencies. Under the PRC Foreign Exchange Control Regulations and Administration of
Settlement, Sales and Payment of Foreign Exchange Regulations, the Group is permitted to exchange RMB for foreign
currencies through banks that are authorised to conduct foreign exchange business. The bank balances earn interest
at floating rates based on daily bank deposit rates.


22. TRADE AND BILLS PAYABLES
Group
2008 2007
RMB’000 RMB’000
Trade payables 105,196 118,357

Bills payables 53,000 41,716
158,196 160,073
The bills payables are secured by the Group’s bank deposits (note 20). Trade and bills payables are non-interest
bearing and are generally on 60 to 120 days’ credit terms.
23. ACCRUED LIABILITIES, OTHER PAYABLES AND DEPOSITS RECEIVED
Group Company
2008 2007 2008 2007
RMB’000 RMB’000 RMB’000 RMB’000
Accrued liabilities 10,886 13,377 3,364 4,685

Other payables 30,400 35,823 – –
Deposits received 724 1,062 – –
42,010 50,262 3,364 4,685
24. INTEREST-BEARING BANK BORROWINGS
Group
2008 2007
RMB’000 RMB’000
Within one year 221,650 150,150

In the second year 32,000 30,750
In the third to fifth year 20,000 32,000
Wholly repayable within 5 years 273,650 212,900
Current portion classified as current liabilities (221,650) (150,150)
Non-current portion classified as non-current liabilities 52,000 62,750
As at 31 December 2008, the Group’s bank loans of RMB15,000,000 were guaranteed by 淄博市華聯礦業有限責任
公司. This company is independent of the Group. As at 31 December 2007, the Group’s bank loans of RMB5,000,000
were guaranteed by 上海佘山經濟技術發展有限公司. This company was a government-related enterprise.
The Group’s bank loans of RMB166,150,000 (2007: RMB161,800,000) were secured by the pledge of certain
of the Group’s property, plant and equipment (note 13) and certain of the Group’s land use rights (note 14);
RMB22,500,000 (2007: Nil) were secured by certain of the Group’s trade receivables (note 18); and RMB70,000,000
(2007: RMB46,100,000) were cross guaranteed by Reyoung and Shandong Yimoo. Except for certain bank loans with
aggregate amount of RMB21,500,000 (2007: Nil) which are interest-bearing at floating rates, all other bank loans of
the Group are at fixed rates. The interest rates of the Group’s bank loans ranged from 5.3% to 8.2% per annum for the
year ended 31 December 2008 (2007: ranging from 5.3% to 8.2% per annum).
As at 31 December 2008, the total guarantees given to the banks by Reyoung and Shandong Yimoo in connection
with the bank loans granted to them were approximately RMB70,000,000 (2007: approximately RMB51,200,000).

25. SHARE CAPITAL
Number of
ordinary shares Amount
US$’000
Authorised:
As at 31 December 2007 and 2008 of US$0.075 each 600,000,000 45,000
Issued:
As at 31 December 2007 and 2008 as fully paid of US$0.075 each 333,400,000 25,005
The issued share capital of the Company was equivalent to approximately RMB206,232,000 as at 31 December 2007
and 2008.
26. RESERVES
Statutory reserves
In accordance with the relevant laws and regulations of the PRC and the articles of association of the PRC subsidiaries
within the Group, each of the PRC subsidiaries is required to transfer not less than 10% of its profit after tax prepared
in accordance with the accounting regulations in the PRC to the statutory reserve until the reserve balance reaches
50% of each of the PRC subsidiaries’ registered capital. Such reserve may be used to reduce any losses incurred by
each of the PRC subsidiaries or to be capitalised as paid-up capital of each of the PRC subsidiaries.
Merger reserve
The merger reserve represents the difference between the nominal value of the share capital of the subsidiaries
acquired as a result of the Restructuring Exercise and the nominal value of the share capital of the Company issued in
exchange thereof.
Share premium
According to the bye-laws of the Company, the share premium account is not distributable.
27. OPERATING LEASE COMMITMENTS
At the balance sheet date, the total future minimum lease payments of the Group under non-cancellable operating
leases for factory facilities are as follows:
Group
2008 2007
RMB’000 RMB’000
Within one year 57 82

In the second to fifth year inclusive 14 56
71 138
The Company did not have any lease commitments as at 31 December 2007 and 2008.


28. CAPITAL AND OTHER COMMITMENTS
At the balance sheet date, the Group had the following outstanding commitments:
Group
2008 2007
RMB’000 RMB’000
Contracted but not provided for in respect of:

Research and development work 3,776 13,306
The Company did not have any capital commitments as at 31 December 2007 and 2008.
29. RELATED PARTY TRANSACTIONS
Compensation of key management personnel
Group
2008 2007
RMB’000 RMB’000
Total remuneration of directors and other members of key management during

the year, all of which were short-term employee benefits 3,549 6,096
30. FINANCIAL RISK MANAGEMENT
The Group does not have written financial risk management policies and guidelines. However, the board of
directors meets periodically to analyse and formulate measures to manage the Group’s exposure to market risk,
including principally changes in interest rates. Generally, the Group employs a conservative strategy regarding its
risk management. As the Group’s exposure to market risk is kept at a minimum level, the Group has not used any
derivatives or other instruments for hedging purposes. The Group does not hold or issue any derivative financial
instruments for trading purposes.
As at 31 December 2008, the Group’s financial instruments mainly consisted of trade and bills receivables, other
receivables, pledged bank deposits, cash and bank balances, trade and bills payables, accrued liabilities, other
payables and interest-bearing bank borrowings.
(i) Interest rate risk
Interest rate risk relates to the risk that the fair value or cash flows of a financial instrument will fluctuate
because of changes in market interest rates. Financial instruments bearing variable rates and fixed rates
expose the Group to cash flow interest rate risk and fair value interest rate risk respectively.
The interest rates and terms of repayment of the Group’s bank borrowings are disclosed in note 24. The
Group’s exposures to fair value interest rate risk on financial liabilities are minimal. The directors of the
Company consider the Group’s exposures to cash flow interest rate risk on bank balances (including pledged
bank deposits) as follows:
Sensitivity analysis
At 31 December 2008, it is estimated that a general increase/decrease of 50 basis points in interest rates,
with all other variables held constant, would increase/decrease the Group’s profit after tax and retained
profits by approximately RMB443,000 (2007: approximately RMB456,000). There would be no impact on other
components of consolidated equity in response to the general increase/decrease in interest rates.

30. FINANCIAL RISK MANAGEMENT (Continued)
(i) Interest rate risk (Continued)
Sensitivity analysis (Continued)
The sensitivity analysis above has been determined assuming that the change in interest rates had occurred
at the balance sheet date and had been applied to the exposure to interest rate risk for financial instruments
in existence at that date. The 50 basis point increase or decrease represents management’s assessment of a
reasonably possible change in interest rates over the period until the next annual balance sheet date. The
sensitivity analysis included in the financial statements for the year ended 31 December 2007 was prepared
on the same basis.
The Group manages interest rate risk by monitoring its interest rate profile regularly. The Group adopts a
policy of ensuring that most of its borrowings are on a fixed rate basis. The policies to manage interest rate
risk have been followed by the Group since prior year and are considered to be effective.
(ii) Foreign currency risk
The Group has no significant foreign currency risk due to its limited foreign currency trade related transactions
during the year and immaterial foreign currency denominated monetary assets and liabilities as at the balance
sheet date.
(iii) Credit risk
Credit risk refers to the risk that the counterparty to a financial instrument would fail to discharge its obligation
under the terms of the financial instrument and cause a financial loss to the Group. The Group’s exposure
to credit risk mainly arises from granting credit to customers in the ordinary course of its operations and its
investing activities.
The Group’s bank balances are mainly placed with reputable PRC banks.
The carrying amounts of the trade and bills receivables and other receivables included in the consolidated
balance sheet represent the Group’s maximum exposure to credit risk in relation to the Group’s financial
assets. No other financial assets carry a significant exposure to credit risk. The Group’s policy is to deal only
with credit worthy counterparties. The Group performs ongoing credit evaluation of its customers’ financial
position. Overdue balances and significant trade receivables are followed up. The Group has no significant
concentration of credit risk due to its large customer base.
(iv) Liquidity risk
Liquidity risk relates to the risk that the Group will not be able to meet its obligations associated with its
financial liabilities. The Group is exposed to liquidity risk in respect of settlement of trade payables and its
financial obligations, and also in respect of its cash flow management.
The Group’s objective is to maintain a balance between continuity of funding and flexibility through the use of
bank loans, trade financing and capital market financing. Liquidity risk is monitored on an on-going basis.
The Group manages its liquidity needs on a consolidated basis by carefully monitoring scheduled debt
servicing payments for long term financial liabilities as well as forecast cash inflows and outflows due in day to
day business. Liquidity needs are monitored in various time bands.
The liquidity policies have been followed by the Group since prior years and are considered as effective in
managing liquidity risks.


(iv) Liquidity risk (Continued)
The table below analyses the Group’s financial liabilities into relevant maturity groupings based on the
remaining period at the balance sheet date to the contractual maturity date. The amounts disclosed in the
table are the contractual undiscounted cash flows. Balances due within 12 months equal their carrying
amounts as the impact of discounting is not significant.
Within one More than one Total
year or on year but less More than undiscounted Carrying
demand than two years two years amount Discount amount
Trade and bills payables 158,196 – – 158,196 – 158,196

Accrued liabilities and
other payables 41,286 – – 41,286 – 41,286
Interest-bearing bank
borrowings 221,650 35,505 24,096 281,251 (7,601) 273,650
Total 421,132 35,505 24,096 480,733 (7,601) 473,132
Within one More than one Total
year or on year but less More than undiscounted Carrying
demand than two years two years amount Discount amount
Trade and bills payables 160,073 – – 160,073 – 160,073

Accrued liabilities and
other payables 49,200 – – 49,200 – 49,200
Interest-bearing bank
borrowings 150,150 33,568 39,683 223,401 (10,501) 212,900
Total 359,423 33,568 39,683 432,674 (10,501) 422,173
(v) Fair values
The fair values of the Group’s current financial assets and liabilities are not materially different from their
carrying amounts because of the immediate or short term maturity of these financial instruments. The fair
value of the non-current financial liabilities was not disclosed because the carrying amount is not materially
different from the fair value since their interest rates are considered as closely approximated to the prevailing
market rates of similar financial instruments.
(vi) Summary of financial assets and liabilities by category
The carrying amounts of the Group’s financial assets and liabilities as recognised at the balance sheet dates
may also be categorised as follows. See notes 3(h) and 3(j) for explanations about how the categorisation of
financial instruments affects their subsequent measurement.

(vi) Summary of financial assets and liabilities by category (Continued)
Group
2008 2007
RMB’000 RMB’000
Financial assets
Loans and receivables:

Current assets
- Trade and bills receivables 138,053 142,409
- Other receivables and deposits 15,058 25,358
- Pledged bank deposits 32,000 32,935
- Cash and bank balances 90,594 68,492
275,705 269,194
Financial liabilities
Financial liabilities measured at amortised cost:

Current liabilities
- Trade and bills payables 158,196 160,073
- Accrued liabilities and other payables 41,286 49,200
- Interest-bearing bank borrowings 221,650 150,150
Non-current liabilities
- Interest-bearing bank borrowings 52,000 62,750
473,132 422,173
31. CAPITAL MANAGEMENT
The Group’s objectives when managing capital are:
(a) to safeguard the Group’s ability to continue as a going concern, so that it continues to provide returns and
benefits for its members and other stakeholders;
(b) to support the Group’s stability and growth; and
(c) to provide capital for the purpose of strengthening the Group’s risk management capability.
The Group actively and regularly reviews and manages its capital structure to ensure optimal capital structure
and shareholder returns, taking into consideration the future capital requirements of the Group. The Group
currently does not adopt any formal dividend policy. Management regards total equity as capital, for
capital management purpose. The amount of capital as at 31 December 2008 amounted to approximately
RMB482,726,000 (2007: approximately RMB457,188,000), which the management considers as optimal having
considered the projected capital expenditures and the forecast strategic investment opportunities.


32. SUBSEQUENT EVENTS
During January and February 2009, the Group borrowed new bank loans of an aggregate amount of RMB165,000,000.
These bank loans bear interest from 5.3% to 5.8% per annum and are repayable from January 2010 to December
2012.
During February and March 2009, the Group repurchased 19,570,000 of its own shares with a total consideration of
approximately S$2,259,000 (equivalent to approximately RMB9,968,000) from SGX-ST and held these shares as treasury
shares.
33. AUTHORISATION OF FINANCIAL STATEMENTS
The financial statements for the year ended 31 December 2008 were approved for issue by the board of directors on
3 March 2009.

Statistics of Shareholdings
As at 13 March 2009
SHAREHOLDERS’ INFORMATION AS AT 13 MARCH 2009
No. of authorized shares : 600,000,000

Par value per share : US$0.075
No. of issued shares : 313,830,000 (334,000,000 Shares in issue, excluding 19,570,000 Shares held in treasury)
Class of shares : Ordinary
Voting rights : One vote per share
STATISTICS OF SHAREHOLDINGS
SIZE OF NO. OF NO. OF

SHAREHOLDINGS SHAREHOLDERS % SHARES %
1 - 999 0 0.00 0 0.00

1,000 - 10,000 386 42.23 2,688,000 0.86
10,001 - 1,000,000 515 56.35 32,556,000 10.37
1,000,001 AND ABOVE 13 1.42 278,586,000 88.77
TOTAL 914 100.00 313,830,000 100.00
Treasury Shares
Number of treasury shares held : 19,570,000

Percentage of treasury shares held against total
number of issued shares (excluding treasury shares) : 6.24%
Substantial Shareholders As At 13 March 2009

(As recorded in the Register of Substantial Shareholders)
Direct Interest % Deemed Interest %
Mr Zhao Yushan – – 140,000,000 44.61

Mr He Maoqun – – 140,000,000 44.61
Mr Li Chungong _ _ 140,000,000 44.61
Honco Union Inc. 140,000,000 44.61 – –
Notes:
Mr Zhao Yushan, Mr He Maoqun and Mr Li Chungang are each deemed to be interested in the 140,000,000 Shares held by Honco Union Inc. by way of their
interests in Honco Union Inc.

Statistics of Shareholdings
As at 13 March 2009
TWENTY LARGEST SHAREHOLDERS
Number of
No. Name of Shareholders Shares %
1 UOB KAY HIAN PTE LTD 142,107,000 45.28

2 HONCO UNION INC. 85,000,000 27.08
3 CITIBANK NOMINEES SINGAPORE PTE LTD 14,547,000 4.64
4 DBS VICKERS SECURITIES (S) PTE LTD 10,739,000 3.42
5 HSBC (SINGAPORE) NOMINEES PTE LTD 8,268,000 2.63
6 OCBC SECURITIES PRIVATE LTD 4,340,000 1.38
7 HENRY QUEK PENG HOCK 4,000,000 1.27
8 TANG KOK SIONG 2,030,000 0.65
9 KIM ENG SECURITIES PTE. LTD. 2,026,000 0.65
10 PHILLIP SECURITIES PTE LTD 1,852,000 0.59
11 LEE GEOK TIN 1,468,000 0.47
12 DBSN SERVICES PTE LTD 1,185,000 0.38
13 HUANG JAY CHIA-YI 1,024,000 0.33
14 NG MAY CHOO 900,000 0.29
15 QUEK SIN HIEN OR QUEK CHIN HOCK 840,000 0.27
16 CHENG AH TECK @ CHENG YIK LAI OR SHELINA NG LEE MOI 789,000 0.25
17 CHAN KIM HOO 650,000 0.21
18 CIMB-GK SECURITIES PTE. LTD. 585,000 0.19
19 CHONG YEAN FONG 565,000 0.18
20 TAN LIAN HAR 555,000 0.18
Total 283,470,000 90.34
Shareholdings Held in Hands of Public
As at 13 March 2009, approximately 55.39% of the Company’s Issued Ordinary Shares (excluding Treasury Shares) are
held in the hands of the public. Rule 723 of the Listing Manual of the Singapore Exchange Securities Trading Limited has
accordingly been complied with.

Notice of Annual General Meeting
NOTICE IS HEREBY GIVEN that the Annual General Meeting of REYOUNG PHARMACEUTICAL HOLDINGS LIMITED (the
“Company”) will be held at Meeting Room 307, Level 3, Suntec Singapore International Convention & Exhibition Centre, 1
Raffles Boulevard, Suntec City, Singapore 039593 on Monday, 27 April 2009 at 10.00 am for the following purposes:
AS ORDINARY BUSINESS
1. To receive and adopt the Directors’ Report and the Audited Financial Statements of the Company for the financial
year ended 31 December 2008 together with the Auditors’ Report thereon. (Resolution 1)
2. To note the retirement of the following Directors retiring pursuant to Bye-law 104 of the Company’s Bye-Laws:
(i) Dr Chong Weng Chiew
(ii) Mr Bernard Tay Ah Kong
Dr Chong will, upon retirement, cease as the Chairman of the Nominating Committee and a member of the Audit
and Remuneration Committees. [See Explanatory Note (i)]
Mr Tay will, upon retirement, cease as the Chairman of the Audit Committee and a member of the Nominating and
Remuneration Committees. [See Explanatory Note (ii)]
3. To approve the payment of Directors’ fees of S$140,000 for the financial year ending 31 December 2009, to be paid
quarterly in arrears (FY2008: S$240,000). (Resolution 2)
4. To re-appoint Grant Thornton as the Company’s Auditors for the ensuing year and to authorise the Directors to fix
their remuneration. (Resolution 3)
5. To transact any other ordinary business which may properly be transacted at an Annual General Meeting.
AS SPECIAL BUSINESS
To consider and if thought fit, to pass the following resolutions as Ordinary Resolutions, with or without any modifications:
6. Authority to allot and issue shares up to 50 per centum (50%) of issued shares
That pursuant to Rule 806 of the Listing Manual of the Singapore Exchange Securities Trading Limited (“SGX-ST”),
authority be given to the Directors of the Company to issue shares (“Shares”) whether by way of rights, bonus or
otherwise, and/or make or grant offers, agreements or options (collectively, “Instruments”) that might or would
require Shares to be issued, including but not limited to the creation and issue of (as well as adjustments to) warrants,
debentures or other instruments convertible into Shares at any time and upon such terms and conditions and to
such persons as the Directors may, in their absolute discretion, deem fit provided that:
(a) the aggregate number of Shares (including Shares to be issued in pursuance of Instruments made or granted
pursuant to this Resolution) does not exceed fifty per centum (50%) of the total number of issued shares
(excluding treasury shares) in the capital of the Company at the time of the passing of this Resolution, of
which the aggregate number of Shares and convertible securities to be issued other than on a pro rata basis
to all shareholders of the Company shall not exceed twenty per centum (20%) of the total number of issued
shares (excluding treasury shares) in the share capital of the Company;
(b) for the purpose of determining the aggregate number of Shares that may be issued under sub-paragraph (a)
above, the total number of issued shares (excluding treasury shares) shall be based on the total number of
issued shares (excluding treasury shares) of the Company as at the date of the passing of this Resolution, after
adjusting for:

(i) new shares arising from the conversion or exercise of convertible securities;
(ii) new shares arising from exercising share options or vesting of Share awards outstanding or subsisting
at the time this Resolution is passed; and
(iii) any subsequent bonus issue, consolidation or subdivision of shares;
(c) the fifty per cent. (50%) limit in sub-paragraph (a) above may be increased to one hundred per cent. (100%) for
issues of Shares and/or Instruments by way of a renounceable rights issue where shareholders of the Company
are entitled to participate in the same on a pro-rata basis; and
(d) that such authority shall, unless revoked or varied by the Company in general meeting, continue in force (i)
until the conclusion of the Company’s next Annual General Meeting or the date by which the next Annual
General Meeting of the Company is required by law to be held, whichever is earlier or (ii) in the case of shares
to be issued in accordance with the terms of convertible securities issued, made or granted pursuant to this
Resolution, until the issuance of such shares in accordance with the terms of such convertible securities.
[See Explanatory Note (iii)] (Resolution 4)
7. Discount For Non Pro-Rata Share Issue
(a) That subject to and conditional upon the passing of Ordinary Resolution 4 above, approval be and is
hereby given to the Directors of the Company at any time to issue Shares (other than on a pro-rata basis to
shareholders of the Company) at an issue price for each Share which shall be determined by the Directors of
the Company in their absolute discretion provided that such price shall not represent a discount of more than
twenty per cent. (20%) to the weighted average price of a Share for trades done on the SGX-ST (as determined
in accordance with the requirements of SGX-ST); and
(b) That (unless revoked or varied by the Company in general meeting) the authority conferred by this Resolution
shall continue in force until the conclusion of the next annual general meeting of the Company or the date by
which the next annual general meeting of the Company is required by law to be held, whichever is the earlier.
[See Explanatory Note (iv)] (Resolution 5)
8. Renewal of the Share Buyback Mandate
THAT:-
(1) for the purposes of Companies Act 1981 of Bermuda (the “Bermuda Companies Act”), the Directors of the
Company be and are hereby authorised to exercise all the powers of the Company to purchase or otherwise
acquire ordinary shares in the capital of the Company (“Share(s)”) not exceeding in aggregate the Prescribed
Limit (as hereafter defined), at such price(s) as may be determined by the Directors of the Company from time
to time up to the Maximum Price (as hereafter defined), whether by way of:-
(a) market purchases (each a “Market Purchase”) on the Singapore Exchange Securities Trading Limited (the
“SGX-ST”); and/or
(b) off-market purchases (each an “Off-Market Purchase”) effected otherwise than on the SGX-ST in
accordance with any equal access scheme(s) as may be determined or formulated by the Directors as
they consider fit, which scheme(s) shall satisfy all the conditions prescribed by the Listing Manual of the
SGX-ST,
and otherwise in accordance with all other provisions of the Bermuda Companies Act and the Listing Manual
of the SGX-ST as may for the time being be applicable (the “Share Buyback Mandate”);

(2) unless varied or revoked by the Company in general meeting, the authority conferred on the Directors
pursuant to the Share Buyback Mandate may be exercised by the Directors at any time and from time to time
during the period commencing from the date of the passing of this Resolution and expiring on the earlier of:-
(a) the date on which the next annual general meeting of the Company (“AGM”) is held or is required by
law to be held;
(b) the date on which the share buyback are carried out to the full extent mandated; or
(c) the date on which the authority contained in the Share Buyback Mandate is varied or revoked;
(3) The Directors be and are hereby authorised to complete and do all such acts and things (including executing
such documents as may be required) as they may consider expedient or necessary to give effect to the
transactions contemplated by this Resolution.
In this Resolution:-
“Prescribed Limit” means 10% of the issued Shares as at the date of passing of this Resolution unless the Company
has effected a reduction of the Shares in accordance with the applicable provisions of the Bermuda Companies Act,
at any time during the Relevant Period, in which event the issued Shares shall be taken to be the amount of the
issued Shares as altered (excluding any treasury shares that may be held by the Company from time to time);
“Relevant Period” means the period commencing from the date on which the last AGM was held and expiring on the
date the next AGM is held or is required by law to be held, whichever is the earlier, after the date of this Resolution;
and
“Maximum Price” in relation to a Share to be purchased or acquired, means the purchase price (excluding brokerage,
commission, applicable goods and services tax and other related expenses) which shall not exceed:-
(a) in the case of a Market Purchase, 105% of the Average Closing Price (as defined below) of the Shares; and
(b) in the case of an Off-Market Purchase, 110% of the Average Closing Price (as defined below) of the Shares; and
where:-
“Average Closing Price” means (1) the average of the closing market prices of a Share over the last five market days,
on which transactions in the Shares were recorded, preceding the date of the Market Purchase or, as the case may
be, the date of the making of the offer pursuant to the Off-Market Purchase; and (2) deemed to be adjusted for any
corporate action that occurs after the relevant five-day period; and
“day of the making of the offer” means the day on which the Company announces its intention to make an offer for
the purchase of Shares from Shareholders, stating the purchase price (which shall not be more than the Maximum
Price calculated on the foregoing basis) for each Share and the relevant terms of the equal access scheme for
effecting the Off-Market Purchase. [See Explanatory Note (v)] (Resolution 6)
By Order of the Board
Leung Wai Ping Noel

Yvonne Choo
Hazel Chia Luang Chew
Secretary / Deputy Secretaries
Singapore, [3 April 2009]

Explanatory Notes:
(i) Dr Chong had informed the Company that he would not be seeking re-election at this Annual General Meeting (“AGM”). Accordingly, he would retire
as a Director of the Company at the close of the AGM pursuant to Bye-law 104 of the Company’s Bye-laws.
(ii) Mr Tay had also informed the Company that he would not be seeking re-election at this AGM. Accordingly, he would also retire as a Director of the
Company at the close of the AGM pursuant to Bye-law 104 of the Company’s Bye-laws.
(iii) The Ordinary Resolution 4 proposed in item 6 above, if passed, will empower the Directors from the date of the above Meeting until the date of the
next AGM, to allot and issue Shares and convertible securities in the Company up to an amount not exceeding fifty per centum (50%) of the total
number of issued shares (excluding treasury shares) in the capital of the Company, of which up to twenty per centum (20%) may be issued other
than on a pro rata basis.
For the purpose of this resolution, the total number of issued shares (excluding treasury shares) is based on the Company’s total number of issued
shares (excluding treasury shares) at the time this proposed Ordinary Resolution is passed after adjusting for new shares arising from the conversion
or exercise of convertible securities, the exercise of share options or the vesting of share awards outstanding or subsisting at the time when this
proposed Ordinary Resolution is passed and any subsequent bonus issue, consolidation or subdivision of shares.
The increased limit of up to 100% [referred to in sub-paragraph (c)] for renounceable pro-rata rights issue will be effective up to 31 December
2010 pursuant to SGX-ST’s news release of 19 February 2009. The increased limit is subject to the condition that the issuer makes periodic
announcements on the use of the proceeds as and when the funds are materially disbursed and, provides a status report on the use of proceeds in
the annual report.
(iv) Ordinary Resolution 5 proposed in item 7 above, if passed, will enable Directors to issue new Shares on a non pro-rata basis, at a discount of not
more than 20% to the weighted average market price of the Company’s shares, determined in accordance with the requirements of SGX-ST. The
discount in issue price of non pro-rata new Share issue is one of the interim measures announced by the SGX to accelerate and facilitate listed
issuer’s fund-raising efforts in a volatile and difficult market condition.
(v) The Ordinary Resolution 6 proposed in item 8 above, if passed, will empower the Directors from the date of the above Meeting until the next AGM
to repurchase ordinary issued shares of the Company by way of market purchases or off-market purchases of up to 10% of the total number of
issued shares (excluding treasury shares) in the capital of the Company at the Maximum Price. Information relating to this proposed Resolution are
set out in the Circular attached.
Notes:
1. A Shareholder being a Depositor whose name appears in the Depository Register (as defined in Section 130A of the Companies Act, Cap. 50 of
Singapore) is entitled to appoint a proxy to attend and vote in his/her stead. A proxy need not be a Member of the Company.
2. If a Depositor wishes to appoint a proxy/proxies to attend the Meeting, then he/she must complete and deposit the Depositor Proxy Form at the
office of the Singapore Share Transfer Agent, Boardroom Corporate & Advisory Services Pte. Ltd. at 3 Church Street #08-01, Samsung Hub, Singapore
049483, at least forty-eight (48) hours before the time of the Meeting.
3. If the Depositor is a corporation, the instrument appointing a proxy must be executed under seal or the hand of its duly authorised officer or
attorney.

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www.reyoung.com.

Reyoung Pharmaceutical Holdings Limited

No. 6 Erlangshan Road, Yi Yuan County

Annual Report 2008

02 Corporate Prof ile

08 Financial and Operations Review

17 Corporate Governance Report

Reyoung Pharmaceutical Holdings Cofan Wealth

100% 100% 100%

Wealthy Summit Corporation Triumphant Empire Inc. Wise Achievement Inc.

Shandong Yimoo Women

Shanghai Yimoo Women

Pharmaceutical Segment Personal Hygiene Segment

0 Annual Report 2008

Annual Report 2008 0

Key Corporate Developments

Business Highlights and Results

0 Annual Report 2008

revenue from our pharmaceutical segment had increased by Appreciation

Details of the Group’s performance and developments during

Looking Ahead Mr. Zhao Yushan

Annual Report 2008 0

BOARD OF DIRECTORS SINGAPORE SHARE TRANSFER AGENT

BERMUDA SHARE REGISTRAR AND SHARE TRANSFER

0 Annual Report 2008

Annual Report 2008 0

Revenue Other revenue

0 Annual Report 2008

Other operating expenses

Annual Report 2008 0

Accrued liabilities, other payables and deposits received

Financial Position and Liquidity

10 Annual Report 2008

Revenue Profit Before Income Tax EPS

RMB 81m RMB 144m

RMB 733m RMB 580m

Personal Hygiene Pharmaceutical

Annual Report 2008 11

Mr Zhao Yushan (赵玉山) Dr Chong Weng Chiew

12 Annual Report 2008

Annual Report 2008 13

14 Annual Report 2008

Annual Report 2008 15

16 Annual Report 2008

Principle 1 : Board’s Conduct of its Affairs

Total held in FY2008 5 4 1 1

Principle 2 : Board Composition

On 15 May 2008, one of our Executive Directors, Mr Li Chungong resigned.

Zhao Yushan - Chairman

Annual Report 2008 17

Corporate Governance Report

Dr Chong Weng Chiew*

Principle 3 : Executive Chairman

18 Annual Report 2008

Principle 4 : Board Membership

Nominating Committee (“NC”)

Dr Chong Weng Chiew (Chairman)

Principle 5 : Board Performance

Principle 6 : Access to Information

Annual Report 2008 19

Corporate Governance Report

Remuneration Committee (“RC”)

0 Annual Report 2008

Annual Report 2008 0

0 Annual Report 2008

Annual Report 2008 0

0 Annual Report 2008

Annual Report 2008 0

0 Annual Report 2008

Annual Report 2008 0