Sino-Forest Corporation

Sino-Forest Corporation

March 24, 2005 17:01 ET

Sino-Forest Corporation Updates Valuation of its Forest Plantation Assets in China




MARCH 24, 2005 - 17:01 ET

Sino-Forest Corporation Updates Valuation of its
Forest Plantation Assets in China

TORONTO, ONTARIO--(CCNMatthews - March 24, 2005) - Sino-Forest
Corporation (TSX:TRE) announced today that it has received the updated,
independent valuation of its commercial forest plantation assets as well
as a prospective valuation of its proposed plantation development plans
in China. The Company engaged JP Management Consulting (Asia-Pacific)
Ltd ("Jaakko Poyry") - a reputable, international consulting firm - to
conduct the valuation. Using a discounted cash flow methodology, Jaakko
Poyry applied a 12% discount rate to real, pre-tax cash flows in order
to estimate that Sino-Forest's existing forest plantations (current
rotation only), as at December 31, 2004, had a value of approximately
USD $566 million. The consultants' report states that Sino-Forest's
plantation area was approximately 241,800 hectares at year-end 2004.

Recognizing that Sino-Forest is in the process of significantly
expanding its forest plantation area under management by 200,000
hectares in Heyuan City, Guangdong Province, the consultants derived the
value of approximately USD $774 million for the "perpetual"
re-establishment and maintenance of all Sino-Forest plantation rotations
over a 50-year period. The report states that Sino-Forest is "at the
forefront of commercial plantation development in China", and that its
position in the market will likely remain dominant due to its
established land bank and long-term relationships with forestry bureaus
in the key southern China provinces of Guangdong, Guangxi, Jiangxi and
Fujian. The full report will be filed and accessible on SEDAR at

The previous value of Sino-Forest's plantation assets, dated October 31,
2003 of USD $345 million, increased to USD $566 million on December 31,
2004 as a result of revised discount rate and log price assumptions and
inclusion of approximately 95,100 hectares of additional forest
plantation area. The book value of Sino-Forest's forest assets on its
balance sheet at year end 2004 was approximately USD $360 million.

The Jaakko Poyry Group of companies is a global consulting and
engineering firm with expertise in three core areas - forest industry,
energy, and infrastructure & environment - and employs 4,600 people in
35 countries.


Contact Information

    Sino-Forest Corporation (in Hong Kong)
    Kee Wong
    Executive Vice President and Chief Financial Officer
    (852) 2877-0078
    (852) 2877-0062 (FAX)
    Sino-Forest Corporation (in Hong Kong)
    Allen Chan
    Chairman and Chief Executive Officer
    (852) 2877-0078
    (852) 2877-0062 (FAX)
    Sino-Forest Corporation (in Toronto)
    Jacques Charbin
    Investor Relations
    (416) 200-5513