The board of directors of Renhe Commercial Holdings Co. Ltd. informed the shareholders of the company and the potential investors that the profit of the Group for the six months ended 30 June 2012 is expected to decrease as compared to the restated profit for the six months ended 30 June 2011. Such decrease was mainly due to the decrease in revenue from transfer of operation rights and decrease in net valuation gain on investment properties as compared to the same period in 2011.

Notwithstanding the above, the Board considers that the overall operations of the Group as a whole remain sound and intact, and the financial position of the Group remains solid.