PLAYMATESTOYS LIMITED ANNUAL REPORT 2007 Playmates Toys Limited (Incorporated in Bermuda with limited liability) (Stock code 869) www.playmatestoys.com 2007 PLAYMATES TOYS annual report GIOCHI BRINQUEDOS GIOCHI BRINQUEDOS GIOCHI BRINQUEDOS GIOCHI BRINQUEDOS GIOCHI BRINQUEDOS GIOCHI BRINQUEDOS GIOCHI BRINQUEDOS TABLE CORPORATE GIOCHI BRINQUEDOS of contents information GIOCHI BRINQUEDOS 1 Statement from the Chairman Directors CHAN Chun Hoo, Thomas (Chairman and Executive Director) GIOCHI BRINQUEDOS GIOCHI BRINQUEDOS 2 Business Review and Prospects CHOW Yu Chun, Alexander (Independent Non-executive Director) LEE Ching Kwok, Rin (Independent Non-executive Director) NOVAK, Lou Robert (Executive Director) 7 Directors and Senior Management SOONG, Ronnie (Executive Director) YANG, Victor (Independent Non-executive Director) GIOCHI BRINQUEDOS 11 Report of the Directors Company Secretary GIOCHI BRINQUEDOS NG Ka Yan GIOCHI BRINQUEDOS 22 Corporate Governance Report JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS Registered TOYS JOUETS Office JUGUETES JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETSClarendon JUGUETES GIOCHI House BRINQUEDOS TOYS JOUETS JUGUETES 34 Independent Auditors’ Report 2 Church Street Hamilton HM11 GIOCHI BRINQUEDOS 36 Consolidated Income Statement Bermuda JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYSPrincipal JOUETS Office JUGUETES GIOCHI BRINQUEDOS 37 Consolidated Balance Sheet 21/F., The Toy House GIOCHI BRINQUEDOS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES100 Canton GIOCHI BRINQUEDOS Road TOYS JOUETS JUGUETES JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES Tsimshatsui 38 Balance Sheet Kowloon, Hong Kong Auditors GIOCHI BRINQUEDOS 39 Consolidated Cash Flow Statement Moores Rowland JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETESChartered GIOCHI BRINQUEDOS Accountants TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS 40 Consolidated Statement of Changes in Equity Certified Public Accountants GIOCHI BRINQUEDOS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES LegalJOUETS Advisors JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES 41 Notes to the Financial Statements Conyers Dill & Pearman Deacons 76 Financial Summary Principal Bankers GIOCHI BRINQUEDOS The Bank of East Asia, Limited JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS Chong Hing Bank Limited GIOCHI BRINQUEDOS JOUETSHang JUGUETES Seng GIOCHI Bank BRINQUEDOS Limited TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES The Hongkong andJOUETS Shanghai JUGUETES GIOCHIBanking BRINQUEDOS Corporation TOYS JOUETS Limited JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES Standard Chartered Bank (Hong Kong) Limited Principal Share Registrars GIOCHI BRINQUEDOS The Bank of Bermuda Limited JOUETS6 JUGUETESFront GIOCHIStreet BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS Stock JOUETS JUGUETESCode GIOCHI BRINQUEDOS GIOCHI BRINQUEDOS Hamilton HM11 The shares of Playmates Toys Limited GIOCHI BRINQUEDOS GIOCHI BRINQUEDOS Bermuda JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI are BRINQUEDOS listed TOYS for trading JOUETS onJUGUETES The Stock TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS Branch Share Registrars Exchange of Hong Kong Limited Tricor Abacus Limited (Stock Code: 869) 26/F., Tesbury Centre Website GIOCHI BRINQUEDOS GIOCHI BRINQUEDOS 28 Queen’s Road East www.playmatestoys.com TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS Hong Kong JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS GIOCHI BRINQUEDOS The following trademarks and copyrights are used in theJOUETS context JUGUETESof this report: GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS American Greetings© 2006 AGC, Inc. All rights reserved. •Batman™ and © DC Comics. AllJOUETS rights JUGUETESreserved. •GIOCHICold Nose BRINQUEDOS Puppy™ TOYSPlaymates Toys JOUETS Inc. JUGUETESAll GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS rights reserved. •Disney© Disney •Disney Fairies© Disney. All rights reserved. •Dinosaur King© 2008 4Kids Entertainment, Inc. All rights reserved. •Draw and Dream™ Playmates Toys Inc. All rights reserved. •Eon Kid© Starz Entertainment Group LLC. •Giochi Preziosi© 2008 Giochi Preziosi Espana •Hello Kitty© 1976-2008 Sanrio Co. Ltd. •Huntik™ Big Bocca Ltd. •ILM Industrial Light & Magic, ILM, the Bulb and Gear Design logo are all registered service marks of Lucasfilm LTD © 2008. All rights reserved. Konami• © 2008 Konami •Kung Fu Panda™ and © 2008 Dreamworks Animation LLC. All rights reserved. •Land GIOCHI BRINQUEDOS Before Time© and related characters are trademarks and copyrights of Universal Studios and U-Drive Productions, Inc. Licensed by Universal Studios Licensing LLLP. Used with permission. All rights reserved. •Lost Copyright© ABC, Inc. •Alias Copyright© ABC, Inc. •Love ’N Blush™ Playmates Toys TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS Inc. All rights reserved. •Love ’n Licks™ Playmates JOUETSToys Inc. JUGUETES All rights GIOCHI reserved. BRINQUEDOS •Madagascar TOYS II™ &© Dreamworks JOUETS JUGUETES Animation GIOCHI LLC. BRINQUEDOS All rights reserved.TOYS • JOUETS JUGUETES GIOCHI BRINQUEDOS Microsoft© 2007 Microsoft Corporation. All rights reserved. •My Life – Another life in your hands™ and © 2008. All rights reserved. •Paramount Studios™ and GIOCHI BRINQUEDOS © 2006 Paramount Pictures. All rights reserved. •Popples™ related trademarks and character designs © 2006 Those Characters From Cleveland, Inc. Used TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS under license by Playmates Toys Inc. All rights reserved. •Rainbow Studios© 2007 RainbowJOUETS JUGUETESStudios, Inc. GIOCHI •Scooby BRINQUEDOS Doo™ and TOYS © Warner Bros. JOUETS Entertainment, JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS Inc. All rights reserved. •Sega© 2008 Sega of America, Inc. •Shrek™&© DreamWorks LLC •Star Trek™&© ParamountJOUETS Pictures. JUGUETES All rights GIOCHI reserved. BRINQUEDOS • TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES Strawberry Shortcake™ and related trademarks © 2006 Those Characters From Cleveland, Inc. Used under license by Playmates Toys Inc. •Struts™ is a trademark of Playmates Toys Inc. All rights reserved. •Teenage Mutant Ninja Turtles® and TMNT are registered trademarks of Mirage Studios, Inc. All rights reserved. •Terminator™ and © Warner Bros. Entertainment, Inc. All rights reserved. •Terminator Salvation™ and © Warner Bros. Entertainment, Inc. All rights reserved. •Transformers© 2007 Hasbro. All rights reserved. •Upper Deck© 2008 The Upper Deck Company. All rights reserved. •Warner Bros.™ GIOCHI BRINQUEDOS and © Warner Bros Entertainment, Inc. All rights reserved. •Warner Brothers Television Group™ and © Warner Bros Entertainment, Inc. All rights reserved. • Yugioh!© 1996 Kazuki Takahashi •4Kids© 2008 4Kids Entertainment, Inc. All rights reserved. •Fox TV Network™ and © Fox. All rights reserved. TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS GIOCHI BRINQUEDOS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS GIOCHI BRINQUEDOS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS JUGUETES GIOCHI BRINQUEDOS TOYS JOUETS