LJ INTERNATIONAL, INC., (NASDAQ/NM: JADE)

Dear Reader,

Today’s featured company arrives on your technological doorstep with a slightly different verve, a certain tenor unique to just this piece. This company, undoubtedly, has a unique business plan bustling on two continents, not the least of which is the enormous Chinese market.

But along with that aspect of today’s story comes another angle, which must be considered when evaluating this company. Bluntly put, who’s representing the deal to the marketplace?

Enter Investor Relations International  (www.irintl.com) a Los Angeles-based IR firm with a spectacular track record of success. Listed among their Case Files (click here to view them) on their site are a passel of success stories, a diverse blend of companies that have benefited from IRI’s potent expertise and relationships.

This brings us to today’s feature company: LJ International (Nasdaq/NM: JADE).  You can expect that the word on JADE’s successes in the domestic and foreign jewelry markets will get out in a big way, just as it has for the other companies featured by IRI.

And, like the products they manufacture, the story is a rich one, as you’ll find in the detailed profile below. While selling over TWO MILLION units a year, JADE has become more than an interesting stock play and an increase in current product demand and new orders should translate into rising revenues and net income levels.  Keep a close eye on this company as we understand they may report third quarter guidance very soon.

LJ International Inc. (JADE) is a vertically integrated company employing approximately 2,000 people. The company designs, brands, markets and distributes a complete range of fine jewelry. While it specializes in the semi-precious jewelry segment, JADE also offers high-end pieces set in yellow gold, white gold, platinum or sterling silver and adorned with semi-precious stones, diamonds, pearls and precious stones.  JADE distributes its products mainly to fine jewelers, department stores, national jewelry chains and electronic and specialty retailers throughout North America and Western Europe.

Selling approximately two million pieces of jewelry each year, JADE recently booked $15 million in early orders for Christmas 2003 at June's Jewelry Manufacturing Show in Las Vegas.  JADE also had phenomenal success as it was featured in September at the Hong Kong Jewelry and Watch Fair  and at the International Jewelry Show in China.  The overwhelming reception at these two shows is further affirmation of the Company's strategic goal to expand into the massive Chinese market.
 

STRATEGY & MARKETS

JADE is dedicated to bringing value to customers and profit to shareholders through the delivery of quality products and services. In the past year, the company has adopted a two-pronged approach of expanding its product lines and broadening its distribution channels to support its growth strategy.

JADE'S product lines incorporate all major categories sought by major retailers including: earrings, necklaces, pendants, rings and bracelets.  Based in Hong Kong with production facilities in Southern China, the Company has been growing using a proven mine-to-market strategy, which eliminates the middleman and ensures tighter quality control at every stage. 

JADE counts 27 of the 40 largest jewelry retailers in North America as its customers, the biggest of which is QVC, a leader in electronic retailing with an audience of 73 million households in the U.S. alone. JADE has a dominating presence in the $2 billion jewelry segment of the U.S. television shopping industry. Other JADE customers include JC Penney, Macys, Helzberg, WalMart, Mervyns and Zales.

With approximately 73-75 percent of JADE's sales being in North America, the Company has laid the groundwork for expansion into Europe and South America and is poised to take advantage of China's vast and lucrative market. 

As a publicly traded company in the United States, JADE is considered a foreign entity by the Chinese government and therefore cannot sell directly into China.  But through its association with WalMart, JADE can now fully expand into the massive markets of China and company management believes its proven and successful QVC model can be replicated in the Peoples Republic. With JADE's manufacturing location in China, intimate knowledge of Chinese business practices, strong governmental relationships and recognized name throughout the region, company management believes JADE will be one of the first jewelry manufacturers to penetrate this market.
 

PRODUCT HIGHLIGHTS

Historically, JADE has focused mainly in the medium-priced, semi-precious jewelry segment, offering collections of rings, necklaces, bracelets, earrings, pendants, brooches and cuff links.  However, since 1999 the company has been widening its range of products and it now offers a full range of fine jewelry: semi-precious stones; diamonds, pearls and precious stones, set in yellow gold, white gold, platinum or sterling silver. 

This sector, which constitutes only 11% of the total $43 billion U.S. jewelry market, is expected to grow substantially as consumer trends indicate an increased demand for this type of jewelry.  JADE is also expanding rapidly into other segments of the market, particularly in diamonds, pearls and sterling silver.  The company believes it will be highly successful in its product diversification strategy because it can leverage its existing strong customer relationships with some of the world's largest jewelry retailers, including WalMart,Zales and Sterling Jewelers.

To date, the Company's designers have created some 5,000 different styles that are contemporary and much sought after. Most of these creations are crafted in 14 and 18 karat gold and silver and set with colored gemstones such as amethyst, topaz, Brazilian garnet/garnet, citrine, aquamarine and peridot. 

The main facility for JADE production allows the Company to fashion up to 60,000 pieces of jewelry per month at full capacity. The less labor-intensive Cad/Cam equipment JADE uses gives more flexibility, perfect repeatability, higher precision and enhances standardization in production. The Company has strong relationships with miners in Brazil and Africa.  In particular, a designated buyer in Brazil keeps a constant lookout for purchasing opportunities. It is the company's policy to buy most of a mine's output in order to establish a preferential position for itself with the mine. Currently, JADE does not need to hedge its precious metals inventories as most production runs are pre-sold.
 

JADE in the NEWS

HONG KONG and LOS ANGELES, Sept. 22 /PRNewswire-FirstCall/ -- LJ International Inc. (Nasdaq: JADE - News), one of the fastest growing fine jewelry companies in the world, today announced that it has received its first orders from ShopNBC, one of the nation's largest home shopping channels and the flagship media property of ValueVision Media (Nasdaq: VVTV - News). The orders totaled approximately $800,000 through September 2003.

HONG KONG and LOS ANGELES, Aug. 14 /PRNewswire-FirstCall/ -- LJ International Inc. (Nasdaq: JADE - News), a leading designer, marketer and distributor of a full range of fine jewelry, today reported improving results for the second quarter ended June 30, 2003. 

SELECTED FINANCIAL HIGHLIGHTS

For the comparable six months ended 6/30/03, revenues rose 13% to $22.8 million. Net income totaled $519 thousand, vs. a loss of $7.8 million. Results reflect the acceptance of new products, and improved efficiencies. (Multex) 

In August, the company reported a 22.8% year-over-year increase in Q2 revenue and a Q2 net income of $0.02 per share, a $0.91 year-over-year improvement and is now beginning to realize profit growth as the result of its cost-cutting efforts and other operational improvements made over the past two years.

Foreign exchange considerations have not had a significant impact on LJI's earnings as all of our sales are conducted in U.S. dollars and wages are mostly paid in Chinese Renminbi. LJI's strategic Hong Kong and Chinese mainland locations enable the company to enjoy tax advantages as well as labor cost savings.

A LETTER TO SHAREHOLDERS FROM THE CHAIRMAN & CEO, YU CHUAN YIH

On Wednesday July 23, 10:00 am ET , LJ International released a Special Letter to Shareholders with an exceptionally positive outlook for the company.  The letter outlines the CEO's views for the quarter that ended March 31, 2003, the success of the company at the recent Jewelry Show in Las Vegas, targets and trends for the Company's revenues, the U.S. economy, diversifying company growth, branding strategies, the development of an e-commerce channel called "Gallery Expressions," tapping China's potential and shareholder communications. 

CONTACT

---

Want to feature YOUR company to over 1 MILLION investors?
Click here to learn more about our programs or email us directly at info@stockupticks.com

Disclaimer: StockUpTicks.com is a property of Market Pathways Financial Relations Incorporated (MP).  The information, opinions and analysis contained herein are based on sources believed to be reliable but no representation, expressed or implied, is made as to its accuracy, completeness or correctness.  Past performance is no guarantee of future results. This report is a paid advertisement and is for information purposes only and should not be used as the basis for any investment decision. MP has been compensated $20,000 by Hot Holdings Inc. for preparation and distribution of this report and other advertising services. This constitutes a conflict of interest as to MP’s ability to remain objective in its communication regarding the subject company.  Write or call MP for detailed disclosure as required by Rule 17b of the Securities Act of 1933/1934.  MP is not an investment advisor and this report is not investment advice. This information is neither a solicitation to buy nor an offer to sell securities but is a paid advertisement.  Information contained herein contains forward-looking statements and is subject to significant risks and uncertainties, which will affect the results.  The opinions contained herein reflect our current judgment and are subject to change without notice. MP and/or its affiliates, associates and employees from time to time may have either a long or short position in securities mentioned.  Information contained herein may not be reproduced in whole or in part without the express written consent of Market Pathways Financial Relations Incorporated.