VODone Limited Driven by strong advertising sales Turnover of 2008 recorded encouraging growth of 13%

VODone Limited (the "Company"; Stock code: 0082) is pleased to announce the audited consolidated financial results of the Company and its subsidiary ("VODone" or the "Group") for the year ended 31 December 2008 (the "Reporting Year").

In 2008, attributed to the triumphant development of advertising businesses of the Group and greatly enhanced corporate image following the cooperation with 2008 Beijing International Media Centre ("BIMC") during 2008 Beijing Olympic Games as being the exclusive new media partner, the turnover of the Group witnessed an impressive growth of 13% to approximately HK$65,922,000 (2007: HK$58,400,000) mainly driven by strong advertising sales which recorded a strong surge of 132% in 2008 over last year. The turnover in the first half of 2008 increased by over 200% as compared with the second half of 2007. However, China's advertising market was slowing down eventually in the second half of 2008 due to gloomy market environment under global financial tsunami and critical credit crisis, the Group reported a drop in advertising sales in second half of 2008 and an operating loss attributable to equity holders in the reviewing year of HK$121,004,000 (2007: operating loss HK$59,680,000).

For the reporting year under review, the group had healthy financial position and abundant operating cash. Bank balance and cash was HK$249,846,000; debt equity ratio and gearing ratio (i.e., interest bearing bank loans and other borrowings to shareholders' equity) were lowered to merely 0.002 (2007: 0.58) and Nil (2007: 0.58) respectively. The significant decrease in liquidity of the Group was largely the result of the repurchase of the HK$410,000,000 convertible notes during the reviewing year.

Reviewing 2008 annual results, the Chairman, Dr. Zhang Lijun truly said that,"In 2008, China's economic and the whole society encountered immense undulations from serious natural disasters, overwhelming Beijing Olympic to global financial tsunami that swept cross each part of the world, which all have brought the China's internet video broadcasting industry and the overall Chinese economy a series of challenges as well as opportunities."

Leveraging on the fast development of VODone BUS network, and as being the exclusive new media partner of BIMC in 2008 Beijing Olympic, our corporate image has been significantly elevated and eventually attracted increasing amount of advertisers to market their products through our platform. Meanwhile, the Group strenuously strived to align our business development with corporate social responsibility and was devoted to our role as new medium for a communal and harmonious growth with the society. In the tragic Sichuan earthquake, we immediately took action to play an active role in relief of the tragedy and on-theground news reporting by utilizing our edge as a new medium to organize a 7x24 alliance Internet video broadcasting. Such move received tremendous response among netizens. The Group also made a RMB1 million donation to help the needed victims. Our involvement and the significant impact generated in these key social events have significantly enhanced our reputation and influence in the new media of China.

As being one of the very few companies that own the complete set of licenses to operate legally on the Internet in the PRC and has not violated any intellectual property rights, VODONE will benefit from the implementation of the Internet regulation announced by the MII and SARFT stating that starting from 31 January 2008, companies that perform businesses related to in-house content/programme production and video streaming on the Internet, without the required licenses, would be forced to close down. Its cooperation with advertisers will also be suspended. The MII and SARFT have already taken actions vigorously. A very recent example of actions taken by SARFT includes the closing down of 162 websites that did not obtain legal licenses to operate on 31 March 2009. In the meantime, VODone's possession of a complete set of required licenses and qualifications to operate video news broadcasting on the Internet ensures the reasonableness and the compliance of legal requirements of its service mode and broadcast content. All the video channels of our websites are copyrighted and thus, the Notice will not have any negative impacts on us. On the contrary, some of our competitors might be materially affected. The MII and SARFT have already taken actions vigorously. The total number of closed down websites now add up to 341. In the reviewing year, the Group has been accredited several most authoritative and prestigious awards in the industry such as ranked "AAA Internet Enterprises Award", "Contributions to Discipline and Governance for China"s Internet Industry Award", and "Top 100 High Growth Enterprises in China's Creativity Industry"

VODone Broadcasting Union System (BUS) (bus.vodone.com)

VODone BUS is at present the largest, most valuable and most influential Internet video advertising broadcasting platform in China. As the key revenue generator for VODONE, the daily page views of VODone BUS reached 150 million per day as of April 2009. Currently, VODone broadcasts embedded on over 2 million websites across China, making it the most influential medium. VODone BUS comprises of eight major channels including Brand Channel, Finance Channel, Women's Channel and Sports Channel, and can now has a clearer segmentation of users and advertisements. VODone BUS can help advertisers deliver their ads in a more accurate and convenient manner so as to advertise their brands more effectively. In addition, the Group continues to innovate and develop new formats of advertising in order to meet different needs of different advertisers.

VODone Portal (www.vodone.com)

The portal not only keeps but augments many channels, such as news, finance, sports, entertainment, original creation, games as well as integrates the various products of its subsidiary with VODone BUS as the representative. In the reviewing year, one the enhancements that VODone Portal has achieved include the newly established Movie Channel, which shows popular movies from around the world and the agreement with Television Broadcasts Limited ("TVB"), enabling VODONE to broadcast many of its favoured TV series on the VODone Portal. Contents on the portal will continuously be enhanced and upgraded in 2009. VODONE is currently in advanced discussion with foreign companies to bring more unique contents into China.

Another newly launched feature of VODONE is the two games on its portal, "Warlords of the Three Kingdoms"and "My Little Three Kingdoms". Since the launch of these two games, they have already attracted tens of thousands of players and subscribers. As a result of such positive feedback, VODONE may introduce more games to its users. This would not only bring more page views to the VODone Portal, but would ultimately attract more advertisers as well.

VODone Live (live.vodone.com)

One big feature of VODONE is the self-created video programmes and live broadcasting of such programmes with online interactions. In 2009, VODONE plans to launch some new live programmes, with particular focus on its finance channel. Such live programmes will concentrate on the analysis of A and H shares and various Hong Kong stocks. VODONE broadcasts China to the world as well as the world to China.

Prospect

Looking into future, Chairman Zhang expected, "VODone continuously focuses on developing internet video broadcasting and new media services, and strives to integrate the business potentials of internet advertising, broadcasting, gaming and telemedia together as our business direction. We believe the population advantage of China will lay a solid ground for flourishing internet market development and generating long term business opportunities."

VODone BUS will continue to be the core driver of revenue in 2009. Looking forward to 2009, the Group will continue to focus on brand strengthening and optimization of our broadcasting platform. Under the financial tsunami, corporate clients may have to cut down expenses on brand promotion. However, we are confident that with our strong advertising platform of VODone BUS, which can accurately deliver commercial messages in various formats, we are well positioned to demonstrate our unique edge and will be an increasingly popular choice among corporate clients.

China's issuance of 3G licenses provides new opportunities to the Group. The Group's affiliated company and strategic partner VODone Telemedia is one of the five recipients in the PRC that have received a 3G mobile TV license. We have set up a specialty team to work on the roll out of mobile TV programmes when 3G mobile phones officially launch in the PRC market, we believe we are well-positioned to capture this market opportunity with our experience, established platform and strategic partnership.

We believe content is key for the fasting changing tele-media sector. In 2009, VODONE plans to launch a number of new live programmes, such as a finance channel which cater for PRC investors of the PRC and Hong Kong stock markets.

For on-line gaming, after thorough planning and execution, we have launched 2 games in February 2009, they were marketed through our BUS systems and leverage the advantage of our massive on-line platform. The games were well received so we plan to launch more games in 2009 to take a more active part this growing market of the PRC.

About VODone Limited

VODone is currently the only Internet video broadcasting company listed in Hong Kong. The affiliated company of VODone Telemedia is an Internet video new media company which owns the fullest set of qualifications and licenses in China's Internet broadcasting industry. It has also obtained the information Network Communicated Audio-Video Program Licence, Internet News Permit, Value added Telecom Service Operation License, Internet Publication Permit and some other required licenses, ensuring itself a healthy development in the future. VODone established VODone Broadcasting Union System (BUS) - the largest Internet video broadcasting union platform in China in 2005. With diversified content, VODone BUS has the ability to accurately deliver advertisements to the right place at the right time according to different industries' requirements through its vertical classification system which carries different advertisements. VODone BUS is the largest Internet video programme as well as video advertisement broadcasting platform.

VODone Broadband is VODone's own platform for broadcasting self-produced programmes and those of its cooperative partners. Its live, news, entertainment, finance and sports programmes are increasingly popular among netizens. VODone's UGC platform allows users to upload content to the web and its cooperation with Microsoft Network MSN China has gained encouraging response as evidenced by over 2,000 programmes being uploaded by different users everyday. VODone also has its own professional team with technical experts in production, broadcasting and transmission, enabling it to broadcast live videos via Internet and satellite. So far, VODone has broadcasted thousands of domestic and international political, economic, cultural and commercial activities over the Internet. VODone is broadcasting China to the world and the world to China. VODone Portal also has popular gaming and shopping channels catering the needs of netizens.

Vodone is determined to become the largest Internet news broadcasting platform in China, integrating upscale lifestyle channels with the functions of media and community. www.vodone.com

Source: VODone Limited

Contact: Wonderful Sky Financial Group Limited
Joanne Chan / Miranda Fok / Bianca Tse
Tel:(852) 2851 1038
Fax:(852) 2815 1352
E-mail:joannechan@wsfg.hk / mirandafok@wsfg.hk  / biancatse@wsfg.hk

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