Cosmos Machinery Enterprises Ltd. provided consolidated earnings guidance for the year ended December 31, 2012. For the year, based on a preliminary review of the consolidated management accounts of the Group, the Group is expected to record a loss. The loss was mainly attributable to: the drop of customers' demand and postponements of orders under the persistent economic downturn and uncertainties of global and the PRC markets in 2012.

As a result, the sales amount of the Group was affected; profit margins were reduced due to the rise in labour cost and fluctuation of raw materials prices. Nevertheless, the overall financial position and operations of the Group remain sound and healthy in such challenging operating environment. The Board remains optimistic to the long term growth and development of the Group.