Hengshi Mining Investments Limited provided earnings guidance for the year ended 31 December 2015. For the period, the Group expects that it will record a net loss and loss attributable to the equity shareholders of the company compared with a profit attributable to the equity shareholders of the company of approximately RMB 263.0 million for the year ended 31 December 2014. Based on the currently available information, the expected consolidated net loss of the Group for the year ended 31 December 2015, as compared with the consolidated net profit for the corresponding period of last year is mainly due to the followings: for the year ended 31 December 2015, as influenced by the continuous decrease of the global and domestic market price of iron ore, the selling price of the Group's products had dropped significantly as compared with the corresponding period of 2014; and as the selling price of the Group's products dropped, an accounting loss was incurred in certain wholly-owned subsidiaries of the Company.

In accordance with International Accounting Standards 36 Impairment of Assets, the Company has engaged an independent valuer to conduct a review on the carrying value of the long-term assets of the relevant subsidiaries so as to determine the recoverable amount of the assets.