Legend Holdings 2020 Revenue And Net Profit Attributable To Equity Holders Of The Company Both Rose By 7%

Strategically Focusing on Core Business, Maintaining Sound Operation and Breaking New Ground

HONG KONG, Mar 31, 2021 - (ACN Newswire) - On March 31, 2021, Legend Holdings Corporation (3396.HK) announced the audited annual results of the 12 months ended December 31, 2020 ("Reporting Period"). In 2020, the Company's revenue was RMB417.567 billion, representing a year-on-year increase of 7%; net profit attributable to equity holders of the Company amounted to RMB 3.868 billion, representing a year-on-year increase of 7%. During the Reporting Period, although the COVID-19 epidemic, has brought many adverse effects on the Company's production and operation in the first half of the year, by actively taking measures, the net profit attributable to equity holders of the Company in the second half of the year increased by 243% year-on-year.

"In 2020, a year of rising uncertainties, Legend Holdings effectively combated the epidemic while making sound progress, forging ahead, and achieving annual targets.", stated Mr. Li Peng, Executive Director and CEO of Legend Holdings, "During the Reporting Period, the strategic investment business actively adjusted its operating strategy, focused on core business and promoted the listing process, particularly helping its core asset Levima Advanced Materials enter the capital market; controlled risks, accelerated the return of resources, to lay a solid foundation for the future development. Financial investments continued to perform well, bringing good profits and cash return. In addition, the Company's unique two-wheel-drive business model created new investment cases and a new paradigm of planning in the high-tech segment. China's 14th Five-Year Plan starts in 2021. Legend Holdings will be taking into account changes in the internal and external environment, actively promote and dynamically adjust strategies, to continue to create value for shareholders and society."

Strategic investment operated stably, new result generated by two-wheel-drive strategy

As the basis of Legend Holdings, the strategic investment business has withstood the test of the epidemic, operated soundly throughout the year, and sought new opportunities in adversity. At the same time, the Company has invested in Shanghai Fullhan Microelectronics in line with the two-wheel-drive strategy, planning the high-tech segment.

Lenovo is an exemplary of turning crises into opportunities, ensuring the stable production and operation of global plants, making outstanding contributions to the fight against the epidemic. It relied on its strong global supply chain management capabilities and manufacturing capabilities, giving full play to the supply chains in China, seizing opportunities and achieving record-high sales revenue for two consecutive quaters, and cemented its leadership in the global PC market; it also made breakthroughs in service-led transformation, and the proportion of new business revenue has increased rapidly. On January 12, 2021, Lenovo announced that it will be listed on the onshore Sci-Tech Innovation Board by issuing CDR. During the Reporting Period, revenue from the IT segment increased by 8% year-on-year to RMB384.992 billion, and net profit attributable to equity holders of the Company increased by 30% to RMB2.093 billion.

As for the advanced manufacturing and professional services segment, its revenue recorded RMB6.230 billion, representing an increase of 5% year-on-year during the Reporting Period, and net profit attributable to equity holders of the Company increased by 61% year-on-year to RMB766 million. Levima Advanced Materials' annual performance was outstanding, and it overcame the challenges brought by the epidemic. While ensuring the stable operation of the Levima Advanced Materials, and the improvement of various indicators, it continued to make breakthroughs in new areas, further optimizing the product structure and making significant progress in R&D and innovation throughout the year. Its net profit increased year-on-year by 21% to RMB655 million, reaching a record high. As a leading domestic air cargo company, Eastern Air Logistics has made great contributions to global epidemic prevention, disaster relief, and resumption of production. At the same time, it seized opportunities to expand its clients and new markets. Its performance in 2020 recorded substantial growth, laying a foundation for the deploying subsequent comprehensive improvement of service capabilities in advance.

Legend Holdings has increased its all-round post-investment management and value-added services for invested companies in the financial services segment, actively adjusted its business strategies, improved services provided for high-quality customers in the real economy, and adopted a more prudent strategy in terms of risk control. During the Reporting Period, it achieved revenue of RMB7.767 billion, and net profit attributable to equity holders of the Company was RMB1.874 billion, and the overall stable operation was achieved. Banque Internationale a Luxembourg (BIL) performed well and started to form an international business network joining four locations. Zhengqi Financial further improved the risk control system to ensure business stability while continuing to practice the "investment-loan linkage", showing satisfying results, a total of five invested companies were listed and the IPO application of two invested companies have been approved; net profit of Zhengqi Financial achieved a year-on-year increase of 140% to RMB521 million during the Reporting Period. In terms of new investments, the Company completed its investment in Hyundai Insurance during the Reporting Period, which turned into an important part of the insurance industry layout.

Although Joyvio Group was hit by the epidemic, it has begun to recover after cost reduction and efficiency enhancement. During the Reporting Period, the agriculture and food segment recorded revenue of RMB17.037 billion. The annual revenue of Golden Wing Mau maintained rapid growth and successfully brought in a strategic investor. Huawen Food successfully completed its initial public offering on the Shenzhen Stock Exchange. The innovative consumption and services segment was seriously impacted by the epidemic. Legend Holdings and the companies in the segment joined hands, overcame the difficulties and mitigated the impact of the epidemic. During the Reporting Period, it recorded revenue of RMB739 million. Better Education actively explored a multi-level model of running a kindergarten, embarked on business transformation, and had a new strategic positioning as a platform-based comprehensive service provider in the preschool education field. The operating income of Shanghai Neuromedical Center increased by 19% year-on-year.

The two-wheel-drive of "strategic investment + financial investment" has always been a unique business model of Legend Holdings. Several leading companies in the industry have been discovered through this model before, and substantial returns have been obtained. During the Reporting Period, the Company strategically took a stake in Shanghai Fullhan Microelectronics, successfully turning a fund investment into a strategic investment in the technology field, in line with the two-wheel-drive strategy, further planning in the high-tech segment. Shanghai Fullhan Microelectronics is China's leading company for the design and development of chips. It has developed a range of proprietary core technologies and maintained a high proportion of R&D investment. In the future, Legend Holdings will leverage its industry resources and advantages to engage with the Shanghai Fullhan Microelectronics for deep cooperation, promoting long-term development.

Financial investment continued to perform well, contributing good profits and cash returns

In 2020, the capital market became more volatile. Financial investment segment adopted a more prudent investment strategy, rode on the policy adjustments, and accelerated the IPOs of several investee companies, helping more than 15 investee companies enter the capital market, and serveral IPO applications have been approved. In 2020, the net profit attributable to equity holders of the Company of the financial investment segment increased by 169% year-on-year to RMB2.439 billion, and the three funds achieved a cumulative cash return of more than RMB4 billion.

Legend Capital, a leading private equity investment institution in China, has managed 25 funds with a scale of over RMB50 billion as of December 31, 2020. During the Reporting Period, the total amount of funds raised was RMB4.524 billion; a total of 51 new project investments were completed, and 44 projects were fully or partially exited, creating good cash returns; 11 companies under management were listed. In addition, 4 invested companies were listed in February 2021. So far, Legend Capital has successfully listed 84 invested companies (not including those listed on NEEQS ). In 2021, Legend Capital plans to raise a new 6th RMB fund and complete the final fundraising of the 3rd RMB medical fund. At the same time, it will promote the exit of funds under management and bring good return and capital backflow for investors.

Legend Star, a leading angel investment institution in China, managed 7 funds in total, of which the size exceeded RMB3 billion with an aggregate of over 280 onshore or offshore invested projects as of December 31, 2020. During the Reporting Period, two companies went public, invested in more than 20 projects, more than 50 projects under management had the next round of financing, and exited 14 projects. As of December 31, 2020, the final closing of the 4th RMB fund had been completed, and the second round closing of the 4th USD fund had been completed.

Hony Capital, an investment and management institution, mainly managed 13 funds in total, of which the size exceeded RMB80 billion as of December 31, 2020. During the Reporting Period, the 3rd property fund completed two rounds of fundraising; the first Hony Venture Capital Fund completed the final settlement and raised USD130 million; Hony Horizon managed 5 mutual funds. During the Reporting Period, both new and follow-on investments in existing projects proceeded in an orderly manner. In terms of post investment management, companies under management were also listed, and project exits were relatively active, contributing to continuous and stable cash collection.

Strategically focus on core business and actively facilitating the IPO of portfolio companies

In 2020, Legend Holdings has made new achievements in actively promoting the listing of its subsidiaries. Levima Advanced Materials was listed on the Shenzhen Stock Exchange at the end of 2020. It is another industry leader that Legend Holdings has successfully cultivated from scratch through capital and resource investment, management and cultural empowerment, and we helped Levima bring in CAS Holdings as a strategic investor in 2017. Levima Advanced Materials' past demonstrates the commitment and determination of Legend Holdings to serve the country through industrial development. It also shows the Company's ability to leverage its inherent advantages to build pillar businesses and serves as an example of the commercialization of Chinese technology and how to scale up a business. Based on Levima Advanced Materials' current stock price, it has brought a value increase of over RMB10 billion for Legend Holdings. On March 11, 2021, Eastern Air Logistics, as one of the first pilot state-owned enterprises for mixed ownership reform, was approved for listing, and will land in the A-share market soon.

Strategic focus on core business is an important part of Legend Holdings' development strategy. During the Reporting Period, the Company exited from Suzhou Trust Corporation Limited, and its exits from CAR and Pension Insurance Corporation Group Limited were completed in the first quarter of 2021. So far, the 3 projects have given Legend Holdings a total cash return of more than RMB4 billion, giving the Company ample capital to fund its future development and planning.

"Technology" led development and promotion of the assets' overall vitality

Global economy has yet to recover, and various uncertainties and challenges still exist. Legend Holdings will take into account changes in the environment, formulate and dynamically adjust future development plans, improve the competitiveness of existing businesses, consolidate and develop pillar assets, and strengthen the Company's fundamentals; continue to optimize the industrial and asset allocation of strategic investment while maintaining proper amount of financial investment; lead development with "technology", giving full play to the unique advantages of two-wheel-drive model, explore investment in technology and health, and promote the assets' overall vitality.

Mr. Ning Min, Chairman and Executive Director of Legend Holdings, said: "2020 is the first year of the new management after assuming office. All the Legenders rose up to the challenges and made significant achievements. Legend Holdings, a diversified investment holding company rooted in China and targetting the world, after years of development and polishing, has accumated profound traditions: a good brand and market image, a deep understanding of Chinese technology and industry, high-quality asset portfolio and value creation capabilities, unique management philosophies and corporate culture, shareholder structure that ensures long-term stable development of the Company, market-oriented incentives and restraint mechanisms, etc. The internal and external challenges remain severe, and there is still a long way to achieve our vision, but looking forward to the future, we are still full of confidence. The 14th Five-Year Plan vigorously advocates a new development pattern with domestic cycle as the main body and mutual promotion of domestic and international dual circulation, which brings us new development areas, including 5G, artificial intelligence, or big data and new infrastructure, all bringing development opportunities in new industries. Legend Holdings will always adhere to the committmentof serving the country through industrial development, seek progress while maintaining stability, focus on optimizing and upgrading existing assets, explore new layouts, actively fulfill social responsibilities, and create a future of win-win cooperation."

About Legend Holdings Corporation

Legend Holdings is a leading diversified investment holding company in China, and has developed a unique two-wheel-drive business model of "strategic investment + financial investment". Through value creation and value discovery, the Company cultivates and manages an outstanding investment portfolio with growth potential, driving sustainable value growth. Strategic investments aim at holding over the long term and focus on strategic segments to cultivate and optimize the portfolio while fostering pillar businesses. Through strategic investments, the Company invests in five segments, namely IT, financial services, innovative consumption and services, agriculture and food, and advanced manufacturing and professional services. Financial investments are driven by financial returns with a proper mix of products and target portfolios, and include angel investment, venture capital and private equity investment, creating a holistic financial investment industrial chain. Based on the deep understanding of economies and enterprises, Legend Holdings has concluded its distinctive investment concepts and management system. Through forward-looking layout, clear investment strategies and sustained value-added services, Legend Holdings has cultivated a number of influential outstanding enterprises in several segments.

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