Liuyang Fireworks AGM Presentation

Liuyang Fireworks Annual General Meeting June 22, 2010

Cautionary Note on Forward-Looking Information
In addition to historical information, the statements set forth throughout this presentation include forward-looking statements that may involve risk and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. This forward-looking information includes, among other things, information with respect to expected growth in the domestic Chinese market, the recovery of the Chinese economy, the shift to more profitable products, decreased selling expenses related to transportation costs, as well as information with respect to the Company’s beliefs, plans expectations, anticipations, estimates and intentions. The words, “may”, “could”, “should”, “would”, “suspect”, “outlook”, “believe”, “anticipate”, “estimate”, “expect”, “intend”, “continue”, “plan”, “predict”, “probable”, “potential”, “target” and similar words and expressions are used to identify forward-looking information. Risks and uncertainties affecting forward-looking information include, but are not limited to, fluctuations and seasonality in demand for fireworks, fluctuations in the costs of production and transportation, fluctuation and uncertainty in foreign currency exchange rates, fluctuation in costs of materials, changes in the laws of the PRC that affect the Company’s operations, regulatory approval, competition, product spoilage and liability, and the risk that revenues do not grow as expected. These and other such factors are discussed in greater detail in the Company’s Filing Statement dated may 27, 2009 and in its other public filings available on SEDAR at www.sedar.com. Potential investors and other readers are urged to consider these factors carefully in evaluating these forward-looking statements and information and are cautioned not to place undue reliance on them. The forward-looking information contained in this presentation reflects the expectations of the Company as of the date of this presentation and, accordingly, is subject to change after such date. While the Company may elect to, the Company does not undertake to update this information at any particular time excepts as required in accordance with applicable securities legislation.

2009 in Review

2009 Financial Results $M CDN Revenue EBITDA Adjusted Net Income $M CDN $M CDN 2009 - First as a public company $8.4 $8.8 $1.7 $1.8 $1.6 $13.4 $1.6 $1.3 $1.3 0 2 4 6 8 10 12 14 16 2007 2008 2009

2009 Operational Highlights
Completed qualifying transaction for TSX-Venture Exchange
Closed non-brokered private placement for $3.1 million
Set-up Toronto operations and named CFO

2009 Operational Highlights
Signed agreement with Quebec-based fireworks distributor
$1.5 million purchase order with U.S. fireworks distributor

Recent Highlights

Q1 2010 Financial Results Revenue Adjusted Net Income $K CDN $M CDN Results impacted by 20% appreciation of $CDN and Stock Compensation Charges of $135,000. $2.5 $2.6 $399 $267

Recent Operational Highlights
Launched display company
Record $2.0 million for Chinese New Year Sales Season
Acquired wholesale license in Zhejiang province

Growth Strategy

Growth Strategy Liuyang Fireworks Current Liuyang Fireworks Target International sales Domestic sales 50% 5% 95% 50%

Chinese fireworks industry supply chain How Liuyang Operates - Today Manufacturer Display company consumer Wholesaler Retailer Display company Liuyang’s Origins Operations launched in March 2010

Chinese fireworks industry supply chain How Liuyang Operates - Tomorrow Manufacturer Display company consumer Wholesaler Retailer Display company Liuyang’s Origins Operations launched in March 2010 Acquisition Focus

Municipal license required to wholesale fireworks Limit of 2-3 licenses per municipality > 3,000 municipalities Fragmented Wholesaler Market

Expand into Wholesale Market Guangdong Region Shanghai Region Northeast Region Strategically target key regions with highest growth opportunities Acquire controlling position of dominant wholesaler Each acquisition should generate $1M to $10M in incremental sales

Proposed Acquisition Timeline Jan. 2010 3 wholesalers Dec. 2010 Sept. 2011 Dec. 2012 7 wholesalers TBD (targets already identified)

Uniquely Positioned
Only Chinese fireworks company publicly-listed in North America—provides access to capital
Ability to expand capacity with minimal capital expenditure
Critical mass and size to execute consolidation strategy
Extensive experience as a distributor through historical export business

Questions

Contact Jacky Long Chief Financial Officer Liuyang Fireworks Limited Tel : 416-613-0208 ext 206 [email_address] www.liuyangfwk.com For more information, please contact:

Liuyang Fireworks AGM Presentation

by TMX Equicom on Jun 23, 2010

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Liuyang Fireworks AGM Presentation Presentation Transcript