To: Business Editor

For immediate release

25th May 2000 - Dairy Farm International Holdings Limited today announced that, as anticipated in the Chairman's comments on the final results for 1999, trading conditions have been heavily impacted by poor performance in Franklins and the continuing price war in Hong Kong. Despite the progress made in Franklins to improve operational disciplines and retail execution, and to reduce the cost base, results are being affected by sales which are currently running below last year. Margins for the year to date in the Hong Kong supermarket sector are significantly below last year, prior to the price war, but are improving slowly. Elsewhere, Mannings, 7-Eleven and Maxim's in Hong Kong, Woolworths in New Zealand, and Wellcome in Taiwan and our South Asia operations are all performing satisfactorily. As anticipated, Dairy Farm will record a loss for the first half of the year. This is expected to be some US$50 million. In the circumstances the Board will review its dividend policy prior to the announcement of interim results scheduled for 2nd August.

Dairy Farm is a leading food and drugstore retailer in the Asia-Pacific Region. At the end of 1999, the Group and its associates operated 2,063 outlets, principally supermarkets, convenience stores and drugstores, employed some 80,000 people in nine territories, and achieved 1999 sales of US$6.8 billion.

For further information, please contact:

Dairy Farm Management Services Limited Ronald J Floto Ian Durant	Tel: (852) 2299 1881 (office) Tel: (852) 2299 1896 (office) email: idurant@dairy-farm.com.hk
Forrest International Limited Sue Gourlay	Tel: (852) 2501 7936 (office) email: sgourlay@forrestintl.com.hk

This and other Company announcements can be accessed through the Internet at "www.irasia.com/listco/sg/dfi".