CN Logistics International Holdings Limited

嘉泓物流國際控股有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 2130)

CN Logistics signed a memorandum of understanding with two Hainan duty-free groups to further seize development opportunities in Hainan

[Hong Kong - 22 March 2021] CN Logistics International Holdings Limited (the "Company", together with its subsidiaries, the "Group", stock code: 2130), a well-established international logistics solutions provider, is pleased to announce the Group has signed a memorandum of understanding with two duty-free groups in Hainan province, namely the Hainan Tourism Duty Free Co., Ltd. ("HTDF") and Hainan Development Holding Co., Ltd. ("HDH") to jointly recruit merchants for their respective duty-free shops, as well as attract international premium brand-owners to enter, and provide one-stop logistics solutions with the aim of grasping the booming possibilities arised from the development of Hainan Free Trade Port.

Since the announcement of the "Master Plan for the Construction of Hainan Free Trade Port" last year, local governments have continued to roll out preferential policies to further promote the direction of developing Hainan as an international tourism island. In terms of tax exemption policies, in addition to increasing the annual tax-free shopping quota for outlying island travelers to RMB 100,000 (the same below), the RMB 8,000 tax exemption limit for a single product has also been released, together with an increase of outlying island duty-free products types from 38 to 45. According to official statistics, after the launching of the new policy, the average daily sales of the four outlying island duty-free shops in Hainan exceeded RMB 120 million, doubled year-on-year. HTDF and HDH were approved by the Ministry of Finance and other ministries and commissions to operate duty-free shops in Hainan in July 2021. The former is a subsidiary of the State-owned Assets Supervision and Administration Commission of Hainan Province, and the latter is the largest provincial state-owned enterprise in Hainan. Riding on the Chinese government's 14th Five-Year Plan to focus on the "dual circulation" economy and leveraging the potential of domestic demand, the cooperation between the Group and two duty-free groups is expected to further seize the huge opportunities brought by the new tax-free policies and new economic plans, and also help more international brands to expand to the Hainan market.

In addition, the first China International Consumer Products Expo will be held in Haikou in May this year. The Group has been awarded as the exclusive logistics services provider in Hall 4 of the Expo, providing logistics services for over 40 high-end consumer brands and cosmetics brands from Japan, South Korea, Australia, Indonesia and Malaysia. The preparations are now in full swing. The Group has been communicating with the brand owners on specific details with an aim to establish a close relationship with brand owners for their landing in Hainan duty-free shops in the future.

Executive Director and Chief Executive Officer of CN Logistics, Mr. Ngan Tim Wing, said, "Hainan Island is developing in a rapid manner. With the introduction of more preferential policies and domestic consumption upgrade, the local consumer tourism industry, especially duty-free shops, is ushering in explosive growth opportunities. Through this cooperation with two outlying islands duty-free shops in Hainan, CN Logistics is expecting to leverage the opportunities of the Hainan servicing team and logistics infrastructure to be gradually in place to assist brand owners to enter Hainan, thereby expanding the customer base and strengthen local businesses. As the development of Hainan's cross-border transportation facilities are at initial stage, we plan to ride on Guangzhou's geographic advantage as a logistics import and export hub in South China to handle logistics orders between Hainan and overseas, and arrange land transportation to provide Hainan's business partners with a more convenient one-stop logistics services to further seize market opportunities. In the long run, we are also closely monitoring the opportunities brought about by the development of the Greater Bay Area, which is expected to echo the development of the Hainan Free Trade Port in the long run."

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About CN Logistics International Holdings Limited

Established in 1991, CN Logistics is a well-established international logistics solutions provider with core business of providing air freight forwarding services and distribution and logistics services in relation to fashion products and fine wine, primarily focusing on high-end fashion (including luxury and affordable luxury) products. According to the CIC Report, the Company ranked first in the distribution and logistics market for high-end fashion products in both the PRC and Hong Kong in 2019.

This press release is issued by DLK Advisory Limited on behalf of CN Logistics International Holdings Limited.

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