Sun King Power Electronics Group Limited provided earnings guidance for the six months period ended June 30, 2012. The company is expected to record a potential increase in operating revenue for the six months ended June 30, 2012 as compared to the same period in the first half of 2011 and the company's net profit may be close to or exceed the breakeven point. The board believes that significant improvement in the company's estimated net profit is mainly attributable to the following reasons: in response to increased costs caused by the exchange rate of the Swiss Franc in recent years, the company has, in the first half of 2012, initiated measures such as the adoption of reasonable pricing strategies and the purchase of forward currency exchange contracts to lock-in exchange rates on the corresponding delivery dates. This has effectively reduced the company's procurement costs of its distribution business; as a listed company, the company continuously seeks to improve its internal control system in order to cut down administrative costs. The company is currently reviewing the management rules of each of its subsidiaries and have already made initial progress in this respect; and the overall economic slowdown at home and abroad during the first half of 2012 has led to postponed orders, increased inventories, increased raw materials costs as well as increased finance costs. To mitigate the impact of rising costs, the company has scaled down its inventories of raw materials and products, and has actively sought to collect receivables or undertaken measures to achieve a similar effect. In light of China's likelihood of maintaining its macro-control policy, the Chinese government is expected to continue increasing investment in infrastructure, as infrastructure is the key driver to national economic growth. This will in turn fuel demand for the company's products.