Jade Road Investments : 2021 Interim Report (English Version)

FINANCIAL HIGHLIGHTS:

• Total income increased to US$1.25 million from interest payments and fair value adjustments (H1 2020: US$1.19 million).
• Net loss of US$0.27 million (H1 2020: US$0.70 million). The core drivers of the net loss are a US$259k finance expense, mainly related to the interest payable on the Company's corporate bond.
• Consolidated loss per share (basic) of US$0.24 cents (H1 2020: US$0.69 cents).
• Consolidated NAV at 30 June 2021 decreased slightly by 0.25% to US$106.2 million/GBP76.8 million (31 December 2020: US$106.5 million/ GBP77.9 million). The decrease in NAV stems from a decrease in cash.
• NAV per share at 30 June 2021 US$0.90 (GBP0.65) (30 June 2020 US$0.95/GBP0.75).
• Period end cash position of US$2.56 million (30 June 2020: US$3.2 million).

INVESTMENT AND OPERATIONAL HIGHLIGHTS:

• Future Metal Holdings Limited ("Future Metal")
  o In March 2021, a new contractor was appointed to further enhance the efficiency of the operation and reach customers with a further geographical radius.
  o Sales have seen an upward trend in the first half of 2021 compared to 2020.

• Fook Lam Moon ("FLM")
  o FLM's business was impacted by the COVID-19 pandemic in 2020, which severely limited inbound tourism, particularly from Mainland China.
  o As the Hong Kong government eases COVID-19 restrictions on restaurants and some air travellers in 2021, the food and beverage industry is gradually recovering to pre-pandemic levels.
• DocDoc Pte Ltd ("DocDoc")

1. In November 2020, DocDoc partnered with SpesNet Global Group, a leading

healthcare technology provider, to integrate its digital third-party administrator ("TPA") technology and provide a first-of-its-kind complete digital health ecosystem to insurers, supporting their policyholders through the continuum of care.

• 1. Under this agreement, DocDoc will receive exclusive access to SpesNet's platform to include Singapore, Malaysia, Thailand, Hong Kong, India, and the People's Republic of China.
• Meize Energy Industries Holdings Limited ("Meize")
• 1. Meize has maintained a full order book from its clients in 2021 due to the strong market demand, especially the offshore wind market.

1. The Jiangsu plant initiated an expansion in early 2021 to meet the rising demand, which was completed and commenced operation in June 2021.

HIGHLIGHTS

CHAIRMAN OF JADE ROAD INVESTMENTS, JOHN CROFT, COMMENTED:

"The Company's portfolio has continued to weather the pandemic storm with the Company's investment manager, Harmony Capital, driving phase two of

1. three-phaseinvestment strategy focused on exits, restructuring our legacy assets and seeking investments in smaller fast growing companies at IPO or pre-IPO stages.

Harmony Capital set out a three-phase strategy to reposition Jade Road. This has involved rehabilitating legacy assets, such as Future Metal Holdings Limited (FMHL) and Meize Energy, towards a full or partial exit and reinvesting the resulting cash into new income-generating assets, prioritising high-growth Asian SMEs in the Healthtech, Medtech and Fintech sectors.

With Asian SMEs increasingly starved of capital, Jade Road is assessing an exceptionally strong pipeline of investee candidates which, with an emphasis on credit instruments such as secured debt or non-mandatory convertible bonds, will result in a well-constructed portfolio with near-term downside protection.

The Board believes Jade Road's new investment strategy is well positioned to construct a solid base of exciting, income generating assets for high- quality growth, promoting long-term value for our shareholders."

For further information on JADE, please visit the Company's website at www.jaderoadinvestments.com and follow the Company on Twitter (@JadeFinance).

ABOUT JADE ROAD INVESTMENTS

Jade Road Investments Limited is quoted on the AIM Market of the London Stock Exchange and is committed to providing shareholders with attractive uncorrelated, risk-adjustedlong-term returns from a combination of realising sustainable capital growth and delivering dividend income.

The Company is focused on providing growth capital and financing to emerging and established Small and Medium Enterprises (SME) sector throughout Asia, well-diversified by national geographies, instruments and asset classes. This vital segment of the economy is underserved by the traditional banking industry for regulatory and structural reasons.

The Company's investment manager, Harmony Capital, seeks to capitalise on its team's established investment expertise and broad networks across Asia. Through rigorous diligence and disciplined risk management, Harmony Capital is dedicated to delivering attractive income and capital growth for shareholders with significant downside protection through selectively investing in assets and proactively managing them.

Harmony Capital is predominately sourcing private opportunities and continues to create a strong pipeline of attractive income-generating assets from potential investments in growth sectors across Asia, including healthcare, fintech, hospitality, IT and property.

For the first half of 2021, Jade Road has been progressing phase two of a three-phase investment strategy focused on rehabilitating legacy assets, exits and seeking investments in smaller, IPO and pre-IPO investments.

Jade Road has delivered a stable financial performance in the period. Total income increased to US$1.24 million from interest earned and fair value adjustments for the first six months of the year (H1 2020: US$1.19 million).

INVESTMENT STRATEGY

I am pleased to report that in spite of the long shadow that COVID-19 has cast over the world in the past 18 months, the Company's existing portfolio has largely avoided any major impairments successfully navigating the challenges presented by the pandemic.

Jade Road is currently undergoing phase two of

1. three-phaseinvestment strategy focused on the portfolio restructuring of its legacy assets which are not fully aligned with the Company's revised investment approach by exiting either through full or partial sales, or IPOs. In addition, the Company is aiming to build a new portfolio of pan-Asian investments providing income and capital gain.

Jade's large legacy assets in China: Future Metal Holdings Limited (FMHL), the largest magnesium dolomite quarry in Shanxi Province, and Meize Energy Industries, one of the largest wind turbine blade manufacturing companies with factories in Inner Mongolia, Ningxia Province, and Jiangsu Province, both reported significant progress for the first six months of 2021.

On our website you can find SRK Consulting's updated Competent Persons Report (CPR) for FMHL, which includes JORC Mineral Resources and Ore Reserves estimates totalling 113 million tonnes of dolomite as measured by Proved and Probable Reserves, and 149 million tonnes of dolomite as calculated by Measured, Indicated and Inferred Resource. As magnesium prices recover from recent weakness, we expect demand for FMHL's products to increase as the year progresses.

Meize Energy initiated an expansion of its third state-of-the-art turbine blade manufacturing plant in Jiangsu, commencing operations in June 2021. The factories are operating at full capacity, producing internationally certified blades for both onshore and offshore wind turbines.

Our Michelin-starred Fook Lam Moon restaurants in Hong Kong are recovering to pre-pandemic levels

and our luxury resort projects in Niseko, Japan are accepting bookings for this upcoming skiing season, although uncertainty remains over the exact timing of a full opening of the resort.

The core strategy is to build a base of income generating assets that covers overheads, management fees and finance costs, with a growing surplus to fund dividends.

As part of this core strategy, Jade Road will look to invest in Asian High Growth Companies via equity (in listed companies and/or pre-IPO investments) as part of its existing investment policy. While Jade Road will consider opportunities in all sectors as they arise, potential opportunities in Technology, including Healthtech, Medtech and Fintech will be prioritised. The Total Allocation under this expanded investment focus will be no more than 10% of Jade Road's present NAV, as of 30 June at US$106.2 million, down slightly from US$106.4 million (31 December 2020) and no more than 20% once the NAV exceeds US$150 million. Investments in each company will not exceed 5% of the total allocation, in order to mitigate risk through diversification.

At the same time, we aim to limit single country and industry exposures to 20% of the overall portfolio and reduce portfolio exposure to China towards 30-40% in the near term.

By targeting the broad Asian SME subsector, Jade Road can access an immense market in which it can leverage both its capital, and its investment manager's direct relevant experience.

From a corporate perspective, Jade Road sees strong appeal in the vibrant start-up environment in regions such as Hong Kong and Singapore, typified by our investment in Singapore-based DocDoc, a leading pan-Asian virtual network of physicians, clinics and hospitals.

Investment candidates are undergoing detailed review from a pipeline of potential opportunities in IT, Fintech, Healthcare and online commerce.

In terms of ESG (Environmental, Social, Corporate Governance), Jade Road has been incorporating ESG principles into our risk management and due diligence processes. All potential investment candidates must demonstrate that they are taking ESG seriously and working towards being as fully ESG compliant for the stage of company, taking proportionality into account.

It is my strong belief that government policy to encourage more sustainable business models, technologies and consumption patterns in Asia is likely to create greater demand for private capital.

CHAIRMAN'S STATEMENT

SUMMARY

Our focus throughout 2021 is on exits, restructurings and investing in smaller, exciting IPO and pre- IPO investments that potentially possess substantial upside. Some of these smaller investments could have a disproportionate interest to our retail investors.

In a market in which Asian SMEs are increasingly starved of capital, Jade Road has seen opportunities to negotiate and invest in structured instruments. Its preference for income-generating assets puts an emphasis on credit instruments such as secured debt or non-mandatory convertible bonds when structuring investments, which the Company believes will result

in a better constructed portfolio with near-term downside protection.

The Board would like to take this opportunity to thank the investment teams for their hard work and commitment during these challenging times.

Jade Road is well positioned for the future with an experienced investment management team, the development of a constructed base of income generating assets for high quality growth, and a resilient liquidity position and balance sheet. I hope to report further progress against this strategy by the end of 2021.

FUTURE METAL HOLDINGS LIMITED ("FMH")

Our largest asset by value is the dolomite quarry project ("Quarry") in China, Future Metal Holdings Limited ("FMHL"), which was previously known as Hong Kong Mining Holdings. The Company has an 85% shareholding in FMHL.

Starting from March 2021, a new contractor was appointed to further enhance the efficiency of the operation and reach customers with a further geographical radius. In line with the wide-ranging industrial activities in China, sales have seen an upward trend. The management of the Quarry is now in contact with external parties regarding a potential business collaboration of highway construction. Together with the potential demand growth from

the construction sector, the local team also noted the recovery in the magnesium market. In August 2021, magnesium prices reached a 13 year high surging from RMB21,200 (USD3,270) to RMB22,500 (USD3,470) per tonne due to a lack of supply in the market. The local team is actively looking for potential smelters in the local region to establish additional sales channels. JADE has been exploring the option of a partial or full exit of this investment by actively engaging with interested parties on the ground in the Shanxi Province as well as with brokers in Mainland China, Hong Kong and Singapore.

Including loan disbursements provided by the Company to FMHL and its subsidiaries and accrued PIK interest, the estimated fair value of the Company's investment is US$50.7 million as of 30 June 2021.