KEY HIGHLIGHTS   (In thousands of US Dollars, except per share data, percentages and as    otherwise stated)                               Quarterly Results        Half-Year Results                           Q2 2009  Q2 2008  YoY(%)  1H2009   1H2008   YoY(%)    Net sales               $101,836 $146,168 (30.3) $203,986 $293,297  (30.5)   Gross profit             $10,422  $20,762 (49.8)  $17,544  $40,292  (56.5)                % of sales    10.2%    14.2%     -      8.6%    13.7%      -   Operating income    (loss)(a)                $1,425   $8,608 (83.4) $(5,114)  $16,420 (131.1)                % of sales     1.4%     5.9%     -    (2.5%)     5.6%      -        per share (diluted)   $0.03    $0.19 (84.2)  ($0.11)    $0.37 (129.7)   Net income (loss)    attributable to Nam Tai    shareholders(a)            $613  $11,804 (94.8) $(3,268)  $40,170 (108.1)                % of sales     0.6%     8.1%     -    (1.6%)    13.7%      -   Basic earnings (loss)    per share                 $0.01    $0.26 (96.2)  ($0.07)    $0.90 (107.8)   Diluted earnings (loss)    per share                 $0.01    $0.26 (96.2)  ($0.07)    $0.90 (107.8)   Weighted average number    of shares ('000)     Basic                   44,804   44,804     -    44,804   44,804      -     Diluted                 44,804   44,811     -    44,804   44,807      -    Note:   (a) Operating loss and net loss for the first quarter of 2009 included       $5.1 million of employee severance benefits in PRC subsidiaries.   

In addition to disclosing results determined in accordance with accounting principles generally accepted in the United States ("US GAAP") as set forth in the table above, management utilizes a measure of operating income / (loss), net income / (loss) and earnings (loss) per share on a non-GAAP basis that excludes certain income and expenses to better assess operating performance. Those non-GAAP financial measures exclude certain items, such as share-based compensation expenses and infrequent or unusual items such as gain on sale of shares of a subsidiary, employee severance benefits in PRC subsidiaries and other income recovered from Tele-Art Inc. (in liquidation). By disclosing the non-GAAP information, management intends to provide investors with additional information to analyze the Company's performance, core results and underlying trends. Non-GAAP information is not determined using US GAAP; therefore, the information is not necessarily comparable to other companies and should not be used to compare the Company's performance over different periods. Non-GAAP information should not be viewed as a substitute for, or superior to, net income or other financial data prepared in accordance with US GAAP as measures of our operating results or liquidity. Users of this financial information should consider the types of events and transactions for which adjustments have been made. See the table below for a reconciliation of non-GAAP amounts to amounts reported under US GAAP.

   GAAP TO NON-GAAP RECONCILIATION   (In millions of US Dollars, except for per share (diluted) and numbers of    shares)                          Three months ended             Six months ended                               June 30,                     June 30,                          2009         2008            2009          2008                             per           per            per           per                            share         share          share         share                       mill- (di-   mill-  (di-   Mill-   (di-   mill-  (di-                       ions luted)  ions  luted)  ions   luted)  ions  luted)    GAAP Operating    Income (Loss)      $1.4 $0.03   $8.6  $0.19  $(5.1) $(0.11) $16.4  $0.37   Add back:   - Share-based      compensation      expenses(a)       0.1     -    0.2   0.01    0.1       -    1.2   0.03   - Professional      expenses in      relation to      privatization      of NTEEP          0.9  0.02      -      -    0.9    0.02      -      -   - Employee severance      benefits in PRC      subsidiaries (b)    -     -      -      -    5.1    0.11      -      -   Non-GAAP Operating    Income             $2.4 $0.05   $8.8  $0.20   $1.0   $0.02  $17.6  $0.40    GAAP Net Income (Loss)    attributable to Nam    Tai shareholders   $0.6 $0.01  $11.8  $0.26  $(3.3) $(0.07) $40.2  $0.90   Add back/(Less):   - Share-based      compensation      expenses(a)       0.1     -    0.2   0.01    0.1       -    1.2   0.03   - Professional      expenses in      relation to      privatization of      NTEEP             0.9  0.02      -      -    0.9    0.02      -      -   - Employee severance      benefits in PRC      subsidiaries      (after deducting      tax and sharing      with noncontrolling      interest) (b)       -     -      -      -    3.2    0.07      -      -   - Gain on sale of      subsidiaries'      shares (c)          -     -      -      -      -       -  (20.2) (0.45)   - Other income      recovered from      Tele-Art Inc. (in      liquidation)(d)     -     -   (2.9) (0.07)     -       -   (2.9) (0.07)   Non-GAAP Net Income    attributable to Nam    Tai shareholders   $1.6 $0.03   $9.1  $0.20   $0.9   $0.02  $18.3  $0.41    Weighted average    number of shares    -diluted ('000)  44,804       44,811        44,804         44,807    Note:   (a) The share-based compensation expenses included approximately       $0.1 million attributable to options to purchase 75,000 shares       granted in the second quarter of 2009 ($0.2 million for year 2008) to       directors in accordance with the Company's practice of making annual       option grants to its directors upon their election for the ensuing       year and approximately $1.0 million principally attributable to       options to purchase approximately 20 million shares granted by the       Company's Hong Kong Stock Exchange- listed subsidiary, Nam Tai       Electronic & Electrical Products Limited ("NTEEP")(Stock Code: 2633),       to certain of  its executive directors and employees in the first       quarter of 2008. In December 2008, NTEEP repurchased and cancelled all       of its outstanding 17,440,000 options from the option holders at a       total consideration of approximately $42,000. Accordingly, Nam Tai       recorded no share-based compensation expense (relating to NTEEP)       during the three and six months ended June 30, 2009.   (b) The expense represents employee benefit and severance arrangements in       accordance with the PRC statutory severance requirements.   (c) On March 4, 2008, Nam Tai completed the sale of its entire equity       interest in J.I.C. Technology Company Limited ("JIC"), a Hong Kong       Stock Exchange listed subsidiary (Stock Code: 00987), to an       independent third party. In this transaction, Nam Tai sold 572,594,978       shares of JIC, representing 74.99% of its outstanding share capital       for cash of approximately $51 million, which resulted in a gain on       disposal of approximately $20 million.   (d) A total amount of approximately $2.9 million of other income in the       Company's financial statements for the second quarter of 2008. This       amount represents Nam Tai's share of proceeds realized from the       disposal for the account of Tele-Art, Inc.'s liquidator of 477,319       Nam Tai shares owned by Tele-Art, Inc. (in liquidation)("Tele-Art")       and was paid in settlement of amounts previously funded by Nam Tai in       connection with Tele-Art's liquidation and in partial satisfaction of       judgments in favor of Nam Tai against Tele-Art.      SUPPLEMENTARY INFORMATION (UNAUDITED) IN THE SECOND QUARTER OF 2009    1. Quarterly Sales Breakdown      (In thousands of US Dollars, except percentage information)                                                              YoY(%)                                              YoY(%)     (Quarterly     Quarter            2009        2008   (Quarterly)   accumulated)   1st Quarter        102,150     147,129     (30.6)        (30.6)   2nd Quarter        101,836     146,168     (30.3)        (30.5)   3rd Quarter              -     160,534   4th Quarter              -     169,021   Total              203,986     622,852     2. Breakdown of Net Sales by Product Segment (as a percentage of Total      Net Sales)                                                        2009         2008   Segments                                         Q2(%) YTD(%) Q2(%) YTD(%)   Consumer Electronic and Communication Products    ("CECP")                                         26%    31%   50%    49%   Telecommunication Component Assembly ("TCA")      57%    54%   36%    38%   Liquid Crystal Display Products ("LCDP")          17%    15%   14%    13%                                                    100%   100%  100%   100%     3. Key Highlights of Financial Position                                                                    As at                                       As at June 30,           December 31,                                    2009            2008            2008   Cash on hand (a)           $232.2 million  $271.9 million  $237.0 million   Ratio of cash (a) to    current liabilities                 2.54            2.28            1.66   Current ratio                        3.58            3.29            2.67   Ratio of total assets to total    liabilities                         4.96            4.37            3.58   Return on Nam Tai shareholders'    equity                             (2.0%)          23.6%            9.4%   Ratio of total liabilities to    total equity                        0.25            0.34            0.39   Debtors turnover                  59 days         50 days         61 days   Inventory turnover                16 days         16 days         18 days   Average payable period            62 days         56 days         65 days    Note:  (a) Includes cash equivalents.     SECOND QUARTER REVIEW   

The business environment in Nam Tai's product sectors remains difficult and extremely competitive. Sales in the second quarter of 2009 were $101.8 million, a decrease of 30.3% as compared to sales of $146.2 million in the same quarter of 2008. Sales in our CECP segment and LCDP segment dropped by 63.7% and 18.9%, respectively, during the second quarter of 2009, as compared to same period in 2008. Sales in our CECP segment declined significantly mainly because of the continuing effect from the global economic downturn. The weak demand in the market for our consumer products adversely affected sales of all of our end-user products such as mobile phone accessories, which principally represented sales of our headsets containing Bluetooth (1) wireless technology, educational products, optical products and home entertainment devices. Sales in our LCDP segment also declined as a consequence of the decline in sales of LCD panels. However, our sales in TCA segment for the second quarter of 2009 increased slightly by 12.3% as compared to the same quarter of 2008 because the increase in sales of our LCD modules.

The Company's gross profit margin in the second quarter of 2009 was 10.2% as compared to 14.2% in the second quarter of 2008, primarily resulting from the decline in sales as well as the shift of sales mix where higher margin products in our CECP segment accounted for only 26% of sales in the second quarter of 2009, but 50% of sales in the second quarter of 2008. Gross profit in the second quarter of 2009 was $10.4 million, a decrease of 49.8%, as compared to $20.8 million in the second quarter of 2008.

Net income attributable to Nam Tai shareholders in the second quarter of 2009 was $0.6 million, as compared to net income of $11.8 million in same quarter of 2008. Basic and diluted earnings per share in the second quarter of 2009 were $0.01 per share, as compared to basic and diluted earnings per share of $0.26 in the second quarter of 2008.

For the six months ended June 30, 2009, our net sales were $204.0 million, a decrease of 30.5% as compared to $293.3 million in the same period last year. The Company's gross profit margin in the first six months of 2009 was 8.6% as compared to 13.7% in the same period of 2008. Gross profit was $17.5 million, a decrease of 56.5%, as compared to $40.3 million in the same period last year. We reported an operating loss for the first six months of 2009 of $5.1 million, compared to operating income of $16.4 million in the same period last year. Our net loss attributable to Nam Tai shareholders for the six months ended June 30, 2009 was $3.3 million, or $0.07 per share (diluted), as compared to net income attributable of Nam Tai shareholders of $40.1 million, or $0.90 per share (diluted), in the same period last year.

Non-GAAP Financial Information

Non-GAAP operating income for the second quarter of 2009 was $2.4 million, or $0.05 per share (diluted), compared to non-GAAP operating income of $8.8 million, or $0.20 per share (diluted), in the second quarter of 2008. Non-GAAP net income attributable to Nam Tai shareholders for the second quarter of 2009 decreased to $1.6 million, or $0.03 per share (diluted), compared to income of $9.1 million, or $0.20 per share (diluted), in the second quarter of 2008.

(1) The Bluetooth(R) word mark and logo are owned by the Bluetooth SIG, Inc. and any use of such mark by Nam Tai is under license.

Liquidity and Financial Resources

Despite current economic conditions, Nam Tai's financial position as at June 30, 2009 remained strong with $4.9 million net cash generated from operating activities during the second quarter and $232.2 million cash on hand, of which about $99 million was held by NTEEP and its subsidiaries, even after the payment of $3.4 million on capital expenditures. Had we completed the privatization of our subsidiary, Nam Tai Electronic & Electrical Products Limited ("NTEEP"), at June 30, 2009, our pro forma cash on hand at that date would have decreased to an estimated $187.8 million, which gives effect to our use of cash to pay the estimated aggregate cost to acquire the NTEEP shares that we did not already own. See the discussion of this privatization transaction below.

Nam Tai's cash on hand has been invested in term deposits with HSBC and China Construction Bank. The Company continues to exercise rigorous corporate governance and control policies and is not involved in trading of any debt securities or financial derivative products.

EXPANSION PROJECTS

During the second quarter of 2009, we expended approximately $3.4 million mainly on our ongoing expansion project in Wuxi near the East Coast of China, approximately 80 miles Northwest of Shanghai. Construction of our new facility in Wuxi is moving toward completion and we expect that it will be on schedule for mass production of FPC boards, FPC subassemblies and other products by the fourth quarter of this year.

As previously announced, we have been considering, and have since decided on, terminating our second Wuxi expansion project, combining the operations we contemplated for a second Wuxi manufacturing facility into the first facility that is nearing completion. We are also continuing to explore the feasibility of returning the second Wuxi parcel to the Wuxi government.