The board of directors of Shanghai Fudan Microelectronics Group Company Limited informed the shareholders of the Company and potential investors that, based on the preliminary assessment of the unaudited consolidated management accounts of the Company and its subsidiaries (the "Group"), it is expected that the Group will record a turnaround to profit attributable to the owners of the parent for the year ended 31 December 2020 of approximately RMB 125,000,000, while the Group recorded an audited loss attributable to the owners of the parent of approximately RMB 161,936,000 for the corresponding period in 2019. The main reasons for the turnaround of the Group's results from loss to profit are: (i) the increase in turnover; (ii) the increase in profit margin brought from the launch of new products; and (iii) the decrease in R&D expenditure due to certain projects that require comparatively huge application of resources and their R&D expenditure are expensed when incurred have completed major design stage of R&D processes.