Larry Jewelry International (HKG:8351) says that, based on an initial review of the unaudited consolidated management accounts of Sharp Wonder Holdings Limited for the year ended 31 December 2011, the management's estimates of the key financial results of Sharp Wonder for the year ended 31 December 2011 are as follows:

It is estimated that the EBIT will increase by approximately 55-60%. The EBIT margin is expected to increase by approximately 2.5-3 percentage points from 6.8% recorded in 2010. This is primarily driven by improvement in sales efficiency. The gross profit margin will increase by approximately 2.5-3 percentage points when compared with 26.1% recorded in 2010.

The revenue is estimated to increase by approximately 3-5% when compared with that of 2010. As Sharp Wonder maintained a low level of marketing expenses, it is estimated that the overall expense ratio (including distribution costs and administrative expenses) will remain at the same level of 19.8% recorded in 2010.

Larry Jewelry International acquired 100% interests in Sharp Wonder in July 2011 to expand into the retail segment. Sharp Wonder operates retail shops under the "Larry Jewelry" brand in premium locations in Hong Kong and Singapore.

The Larry Jewelry International group engages in the wholesale of jewelry through its wholly owned subsidiary, Eternity Jewelry Company Limited. For the nine months ended 31 December 2011, sales from Eternity represented approximately 6% of the consolidated revenue of the group. As reported in the interim results, Eternity's business has been seriously affected by the slowdown of economy in Europe and North America.

The above have not taken into consideration headquarter expenses including but not limited to professional fees associated with the acquisitions and the capital raising activities, termination of the retail business under "Eternity" in Macau, effect of the purchase price allocation in connection with acquisition of Sharp Wonders on the inventory of the group on a consolidated basis, issuance of staff options and interest expenses. Going forward, management will focus its attention and resources in the retail segment which have a much better growth potential.

The group plans to announce details relating to its annual results for the year 2011 around the end of March 2012.